TIDMBCE
RNS Number : 7622J
Beacon Energy PLC
18 August 2023
18 August 2023
Beacon Energy plc
("Beacon Energy" or the "Company")
Schwarzbach-2(2.) Well Update
Beacon Energy (AIM:BCE), the full-cycle oil and gas company with
a portfolio of production, development, appraisal and exploration
onshore German assets through its wholly-owned subsidiary, Rhein
Petroleum GmbH ("Rhein Petroleum"), announces an update on the
Schwarzbach-2(2.) ("SCHB-2(2.)") well.
Summary:
-- The SCHB-2(2.) well has encountered good quality oil-bearing
reservoirs in the Meletta-Schichten ("Meletta") sandstones and the
Pechelbronner-Schichten ("PBS") sandstones within the Stockstadt
Mitte segment of the Erfelden field.
-- An electric wireline logging programme has been completed and
initial analysis shows good quality oil-bearing reservoirs with
porosity ranges above pre-drill expectations.
-- Initial evaluation of the logs over the PBS indicates a
34-metre gross interval containing 28 metres of oil-bearing net
reservoir, with porosities averaging 18% and up to 28%, all of
which significantly exceed pre-drill estimates.
-- These oil-bearing reservoirs were encountered approximately
25 metres higher than prognosis with oil observed on the shale
shakers and in the mud pit whilst drilling these intervals.
-- No water-bearing sands were encountered in the Meletta or the PBS intervals.
SCHB-2(2.) electric wireline well logging results
The SCHB-2(2.) well reached total drill depth of 2,255m metres
(1,717 metres True Vertical Depth) on 13 August 2023. This well was
drilled to target hydrocarbons in the undeveloped Stockstadt Mitte
segment of the Erfelden field, with 2P oil reserves of 3.784mmbbls
assigned to this segment from the independent Competent Person's
Report ("CPR") published by the Company in December 2022.
The electric wireline well logging has now been conducted in the
well and is interpreted to have encountered good quality
oil-bearing reservoir in the Meletta and the PBS reservoirs with
porosity ranges above pre-drill expectations. The initial
evaluation of the logs over the PBS indicates a 34-metre gross
interval containing 28 metres of oil-bearing net reservoir, with
porosities averaging 18% and up to 28%, all of which significantly
exceed pre-drill estimates.
The target reservoirs were encountered approximately 25 metres
higher than prognosis and oil was seen on the shale shakers and in
the mud pit whilst drilling these intervals. No water-bearing sands
were encountered in any of the target reservoirs.
The thicker oil-bearing net reservoir and higher range of
porosities are better than pre-drill expectations and, in
combination with the shallower target depth, have positive
implications for both the reserves description and the future cash
generative potential of this segment of the Erfelden field.
The operating team will now undertake reservoir clean-up,
production testing and install the production liner to bring the
SCHB-2(2.) well into production through the existing Schwarzbach
facilities which are owned and operated by the Company. The
expectation is that this production will be brought onstream over
the next month.
The Company expects to provide a further update on progress of
the SCHB-2(2.) well after undertaking the reservoir clean-up
operation and production testing.
Beacon Energy Chief Executive Officer, Larry Bottomley commented
:
"The SCHB-2(2.) well has now been safely, effectively and
successfully drilled and logged, a testament to the quality of the
Rhein Petroleum operating team who delivered a positive outcome
despite encountering certain technical challenges through the
drill. The well has encountered oil bearing reservoir in the
Meletta and PBS sandstones, both shallower than predicted with the
PBS being a thicker interval with more sand and of better quality
than pre-drill estimates. These results imply significant upside to
the reserve range assigned to the Stockstadt Mitte segment in the
CPR published by the Company in December 2022, and this will be the
focus of one of the post-well projects.
"The electrical wireline logs demonstrate that this well has the
capacity to materially increase the Company's production and
revenue as the well is brought onstream through our wholly-owned
and operated existing facilities. This is a very important step in
the Company's aspiration to build a self-funding platform for
growth.
"In addition, the data provided from the SCHB-2(2.) well will
help to de-risk the 2C contingent resources of 2.4mmbbls assigned
to the adjacent Schwarzbach South segment which will be targeted
during the further development of the Erfelden field.
"The operations team will now focus on completing the well for
production and we will update the market as appropriate".
Enquiries:
Beacon Energy plc
L arry Bottomley (CEO) / Stewart MacDonald (CFO) +44 (0)20 7466 5000
Strand Hanson Limited (Financial and Nominated Adviser)
Rory Murphy / James Bellman +44 (0)20 7409 3494
Buchanan (Public Relations)
Ben Romney / George Pope +44 (0)20 7466 5000
Tennyson Securities Limited (Joint Broker)
Peter Krens / Ed Haig-Thomas +44 (0)20 7186 9030
Optiva Securities Limited (Joint Broker)
Christian Dennis +44 (0)20 3411 1881
For further information, please visit www.beaconenergyplc.com and @BeaconEnergyPlc on Twitter
To register for Beacon Energy's email alerts, please complete
the following form:
https://www.beaconenergyplc.com/media-centre/news/#alerts
The information contained within this announcement is deemed by
the Company to constitute inside information as stipulated under
the Market Abuse Regulation (EU) No. 596/2014 as it forms part of
United Kingdom domestic law by virtue of the European Union
(Withdrawal) Act 2018.
Technical Standard
The technical information in this announcement has been prepared
under the PRMS - Petroleum Resources Management System created by
the Society of Petroleum Engineers, a global standard of petroleum
reserve and resource classification together with guidelines and
accepted methodologies for the definition and estimation of
petroleum resources and their monetary valuation.
Qualified Person's Statement
Mr Larry Bottomley, CEO at Beacon Energy, has reviewed and
approved the technical information contained within this
announcement, in his capacity as a qualified person, as required
under the AIM rules. Mr Bottomley has over 40 years' experience in
the oil & gas industry, prior to which he studied Geology
(BSc.) at Imperial College, University of London, followed by
Stratigraphy (MSc.) at Birkbeck College, University of London.
About the Erfelden Field
The Erfelden oilfield is the most northern oil field in the
Upper Rhine Graben and is comprised of four juxtaposed structural
segments: the mainly depleted Kuehkopf segment, the producing
Schwarzbach Main segment, the Stockstadt Mitte segment which is the
focus on the current development programme and the unproven
Schwarzbach South segment.
The westerly Kuehkopf segment was discovered by Exxon and
produced oil between 1956 and 1985, who also operated the adjacent
Stockstadt field. Both accumulations were discovered, appraised and
developed from the subsurface description from legacy 2D seismic
data.
Rhein Petroleum (a wholly-owned subsidiary of Beacon Energy)
subsequently secured the licence (Operator, 100%) and acquired an
extensive 3D seismic survey which led to the discovery of the
Schwarzbach Main segment in 2015 when the Schwarzbach-1 well
(SCHB-1) discovered oil in the Oligocene Pechelbronner-Schichten
("PBS") sandstones in a North-South trending structural high at
northern end of the Erfelden Field. The Schwarzbach Main segment is
still producing light oil (37-38(o) API) from the SCHB-1a well
through the Schwarzbach Production facility.
The Schwarzbach-2(2.) development well (SCHB-2(2.)) has now
proved the commercial potential of this segment. The independent
Competent Person's Report published by the Company in December 2022
assigned 2P reserves of 3.784mmbbls to the Stockstadt Mitte
segment.
The development plan for the Stockstadt Mitte segment envisages
3 wells - the SCHB-2(2.) production well and subsequently an
additional 2 wells; a producer and a water injector. The aim is
that these additional wells will be drilled funded from the free
cash flow generated by production from the SCHB-2(2.) well.
The drill pad for these 3 wells was prepared immediately
adjacent to the Schwarzbach Production facility, which is
wholly-owned and operated by the Company, and conductor pipes for
each of these wells were set to a depth of 85m below ground level.
A flowline from the drilling pad to the Schwarzbach Production
facility will allow tie-back and hook-up as these wells are
completed and put into production.
The Schwarzbach South segment is undrilled, with the 2C
Contingent Resources of 2.4mmbbls described in the CPR now
significantly de-risked by the results of the SCHB-2(2.) well. This
forward plan is that this segment will be the target of future
drilling.
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