Prospex Energy PLC Approval of El Romeral Well Workover (5240M)
22 Septiembre 2021 - 01:00AM
UK Regulatory
TIDMPXEN
RNS Number : 5240M
Prospex Energy PLC
22 September 2021
Prospex Energy PLC / Index: AIM / Epic: PXEN / Sector: Oil and
Gas
22 September 2021
Prospex Energy PLC
Approval of El Romeral Well Workover
Prospex Energy PLC, ('Prospex' or the 'Company') the AIM quoted
investment company (AIM:PXEN) focused on European gas and power
projects, is pleased to announce that its joint venture company
Tarba Energía S.L. ("Tarba") has fully approved the budget for well
intervention work at its gas to power project at El Romeral in
Southern Spain. Tarba is the operator of the plant. Upon success,
the well workover has the potential to increase gas production by
up to 15,000 cubic metres per day and allow the subsequent start-up
of a second generator to double electrical output.
Highlights
-- Gross budget of EUR89,000 fully approved by Tarba
-- Tarba is in advanced stages of selecting contractors
-- Contract awards are expected within two weeks
-- Chemicals for the workover have been ordered by Tarba in anticipation of contract awards
-- The workover is scheduled for the week commencing 18 October 2021
The Company has a 49.9% interest in the El Romeral gas to power
plant through its interest in Tarba, which is the operator of the
plant. The gross budget for the well intervention work is
EUR89,000, comprising EUR65,000 for the well intervention and
EUR24,000 for data acquisition. Tarba is in the advanced stages of
selecting contractors for the well workover and data collection
campaign and the contracts are expected to be signed over the next
two weeks. Services to be provided include the overall maintenance
contract, the provision of a slick-line unit and operating
personnel and the supply of chemicals (in addition to those ordered
by Tarba), including laboratory testing. The well intervention work
is planned on one of the suspended wells that is connected by
pipeline to the El Romeral power station. This 'Rio Corbones' well
was shut-in 2 years after first production in 2014 due to water
build up in the well and has been suspended since then pending a
workover. Produced water had collected across the production
interval preventing gas production and so a low-cost workover has
been designed to lift this water from the well which has
re-pressurised since it was shut in. The workover will involve the
injection of foaming surfactants via the production tubing to
create a low-density foam from the gas and water in the well. This
will reduce the water that has built up in the tubing and allow the
gas to flow to surface. This is a tried and tested workover
procedure that has been championed by one of the Company's
directors Alasdair Buchanan, who has been working in close
conjunction with the Tarba operating team.
The Rio Corbones well workover can be viewed in the context of
rising prices for electricity throughout Europe and Spain in
particular. When Tarba acquired the El Romeral plant from Naturgy
in March 2021, gross income from electricity generation at the
plant averaged EUR60,000 per month, which just covered operating
costs. Since then, wholesale electricity prices in Spain have more
than trebled and gross income for Tarba has increased
accordingly.
Mark Routh Prospex's CEO commented:
"This well workover plan is a perfect example of the ongoing
strong collaboration we have in Spain. Alasdair Buchanan has
brought his depth of knowledge and experience to propose and help
design a low cost, tried and tested well intervention project with
the aim of increasing our income from electricity generation at the
El Romeral power plant. With electricity prices currently at an
all-time high, this well workover, if successful, will provide a
return on investment measured in months, if not weeks."
"Wholesale electricity prices in Spain hit EUR180/MWh last week.
In context, for the 12 months to May 2021 wholesale electricity
prices averaged EUR50/MWh. Gross income for Tarba at El Romeral has
exceeded EUR130,000 per month for the past two months and is
expected to exceed EUR184,000 in September, a very welcome
increase."
This announcement contains inside information for the purposes
of Article 7 of the Market Abuse Regulation (EU) 596/2014 as it
forms part of UK domestic law by virtue of the European Union
(Withdrawal) Act 2018 ("MAR") and is disclosed in accordance with
the Company's obligations under Article 17 of MAR.
* * ENDS * *
For further information visit www.prospex.energy or contact the
following:
Mark Routh Prospex Energy PLC Tel: +44 (0) 20 7236
1177
Rory Murphy Strand Hanson Limited Tel: +44 (0) 20 7409
Ritchie Balmer 3494
Colin Rowbury Novum Securities Limited Tel: +44 (0) 20 7399
Jon Belliss 9427
Duncan Vasey Peterhouse Capital Limited Tel: +44 (0) 20 7220
9797
Susie Geliher St Brides Partners Ltd Tel: +44 (0) 20 7236
Catherine Leftley 1177
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