TIDMTGL
RNS Number : 2991N
TransGlobe Energy Corporation
29 September 2021
This Announcement contains inside information as defined in
Article 7 of the Market Abuse Regulation No. 596/2014 ("MAR"). Upon
the publication of this Announcement, this inside information is
now considered to be in the public domain.
TRANSGLOBE ENERGY CORPORATION OPERATIONS UPDATE
AIM & TSX: "TGL" & NASDAQ: "TGA"
Calgary, Alberta, September 29, 2021 - TransGlobe Energy
Corporation ("TransGlobe" or the "Company") provides the following
operations update. All dollar values are expressed in US dollars
unless otherwise stated.
COMPANY PRODUCTION
Production Summary (WI before royalties and taxes):
(Boepd) Q2 2021 Jul 2021 Aug 2021 Sep 2021 YTD Average
(to Sep 18(th) )
Egypt 10,727 11,311 11,541 11,214 10,758
-------- --------- --------- ------------------ ------------
Canada 2,350 2,230 2,010 1,986 2,144
-------- --------- --------- ------------------ ------------
Total 13,077 13,541 13,551 13,200 12,902
-------- --------- --------- ------------------ ------------
Compared to Q2, 2021, during the current quarter to date,
natural production declines in Egypt were more than offset by well
optimization activities and new drilling. Production in Canada
declined naturally while awaiting the production start from recent
new drilling, which is anticipated in early Q4-2021.
Please see the table entitled "Production Disclosure" at the end
of this news release for the detailed constituent product types and
their respective quantities measured at the first point of sale for
all production amounts disclosed in this news release on a Bopd and
Boepd basis.
Arab Republic of Egypt
Eastern Desert (100% WI)
The Company continues to utilize the EDC-64 rig drilling
development oil wells.
In West Bakr, during the quarter, the Company successfully
drilled two development oil wells and is moving on to a third well,
K-66, at quarter end.
The K-62 development well was drilled to a total depth of 1,473
meters, and encountered oil-bearing sands in the Asl-A formation.
The reservoir section has been fully logged and evaluated, with an
internally estimated 24.2 meters of net oil pay in the Asl-A
reservoirs. The Asl-A2 was completed for oil production.
The second well in West Bakr, K-65, was drilled to a total depth
of 1,730 meters, and encountered oil-bearing sands in the Asl-A,
Asl-B, Asl-C, Asl-D and Asl-E formations. The reservoir section has
been fully logged and evaluated, with an internally estimated 10.6
meters of net oil pay in the Asl-A sand, 12.5 meters of net oil pay
across the Asl-B sand, 6.1 meters of net oil pay across the Asl-C
sand, 5.5 meters of net oil pay across the Asl-D sand and 11.4
meters of net oil pay in the Asl-E sand (total net oil pay 46.1
meters). The Asl-E is expected to be completed for production in
this well. The Asl-A, Asl-B, Asl-C, and Asl-D are expected to be
recovered through future recompletions of this well.
The Company drilled one well in North West Gharib, NWG-3B-2, to
a total depth of 1,627 meters to assess Red Bed potential in the
northern area of our development leases. The well encountered Red
Bed sands which were wet. The results are under evaluation to
identify any up-dip sidetrack potential.
Western Desert (100% WI)
The lower Bahariya reservoir at SGZ-6X continues to produce on
Gas Oil Ratio ("GOR") control at a field estimated 680 Bopd of
light oil with a 46% watercut.
With improved oil prices and spare capacity available in the
South Ghazalat early production facility, the Company has
accelerated drilling of an oil exploration well on the SGZ--7B
prospect to the east of SGZ-6X. The well will target light oil in
the Bahariya reservoir and fulfills our commitments to EGPC as part
of the grant to the Company of a 10-block development lease in
2019. The Company anticipates spudding this well in early Q4,
2021.
Canada
The Company successfully drilled, completed, and equipped one
2-mile and two 1-mile horizontal wells in the northern area of our
exciting Cardium reservoir extension at South Harmattan, first
identified by the 2-20 well in 2019.
A 6 km gas line to connect to Company infrastructure is nearing
completion, along with the final surface tie-ins. The Company
expects the wells to be brought into production sequentially during
October 2021. Additional information on individual well performance
will be provided when sufficient stabilized production history has
been obtained late 2021 / early 2022.
Corporate
The Mercuria Prepayment Agreement was fully repaid during the
quarter with the final $10 million being paid in August 2021. The
Agreement has been amended to $10 million (undrawn) and extended to
December 31, 2021 to coincide with the expiry of our remaining
Brent crude oil hedges of 150,000 bbls.
The Company expects the ratification of the consolidated and
amended Eastern Desert Production Sharing Contracts to occur in the
next quarter.
CEO's Statement
"We are pleased with the progress of the Egypt drilling program,
reversing 2020 declines and now increasing production. The Company
eagerly awaits the results from the new South Harmattan wells in
Canada, and is also excited by the prospect that with the Egyptian
parliament beginning its fall session in early October,
ratification of our transformational PSC consolidation will occur
shortly."
About TransGlobe
TransGlobe Energy Corporation is a cashflow focused oil and gas
exploration and development company whose current activities are
concentrated in the Arab Republic of Egypt and Canada. TransGlobe's
common shares trade on the Toronto Stock Exchange and the AIM
market of the London Stock Exchange under the symbol TGL and on the
NASDAQ Exchange under the symbol TGA.
For further information, please contact:
TransGlobe Energy Corporation +1 403 264 9888
Randy Neely, President and CEO investor.relations@trans-globe.com
Eddie Ok, CFO http://www.trans-globe.com
or via Tailwind Associates
Tailwind Associates (Investor Relations) +1 403 618 8035
Darren Engels darren@tailwindassociates.ca
http://www.tailwindassociates.ca
Canaccord Genuity (Nomad & Joint-Broker)
Henry Fitzgerald-O'Connor
James Asensio +44(0) 20 7523 8000
Shore Capital (Joint Broker)
Jerry Keen
Toby Gibbs +44(0) 20 7408 4090
Advisory on Forward-Looking Information and Statements
Certain statements included in this news release constitute
forward-looking statements or forward-looking information under
applicable securities legislation. Such forward-looking statements
or information are provided for the purpose of providing
information about management's current expectations and plans
relating to the future. Readers are cautioned that reliance on such
information may not be appropriate for other purposes.
Forward-looking statements or information typically contain
statements with words such as "anticipate", "strengthened",
"confidence", "believe", "expect", "plan", "intend", "estimate",
"may", "will", "would" or similar words suggesting future outcomes
or statements regarding an outlook. In particular, forward-looking
information and statements contained in this document include, but
are not limited to, the Company's strategy to grow its annual cash
flow; anticipated drilling, completion and testing plans,
including, the anticipated timing thereof, prospects being targeted
by the Company, and rig mobilization plans; expected future
production from certain of the Company's drilling locations;
TransGlobe's plans to drill additional wells, including the types
of wells, anticipated number of locations and the timing of
drilling thereof; the timing of rig movement and mobilization and
drilling activity; the Company's plans to file development lease
applications for certain of its discoveries, including the expected
timing of filing of such applications and the expected timing of
receipt of regulatory approvals; anticipated production and
ultimate recoveries from wells; to negotiate future military access
(including the expected timing thereof), including the anticipated
timing of wells on production; TransGlobe's plans to continue
exploration, development and completion programs in respect of
various discoveries; future requirements necessary to determine
well performance and estimated recoveries; the ratification of the
amendment, extension, and consolidation of the Company's Eastern
Desert Concessions; and other matters.
Forward-looking statements or information are based on a number
of factors and assumptions which have been used to develop such
statements and information but which may prove to be incorrect.
Although the Company believes that the expectations reflected in
such forward-looking statements or information are reasonable,
undue reliance should not be placed on forward-looking statements
because the Company can give no assurance that such expectations
will prove to be correct. Many factors could cause TransGlobe's
actual results to differ materially from those expressed or implied
in any forward-looking statements made by, or on behalf of,
TransGlobe.
In addition to other factors and assumptions which may be
identified in this news release, assumptions have been made
regarding, among other things, anticipated production volumes; the
timing of drilling wells and mobilizing drilling rigs; the number
of wells to be drilled; the Company's ability to obtain qualified
staff and equipment in a timely and cost-efficient manner; the
regulatory framework governing royalties, taxes and environmental
matters in the jurisdictions in which the Company conducts and will
conduct its business; future capital expenditures to be made by the
Company; future sources of funding for the Company's capital
programs; geological and engineering estimates in respect of the
Company's reserves and resources; the geography of the areas in
which the Company is conducting exploration and development
activities; current commodity prices and royalty regimes;
availability of skilled labour; future exchange rates; the price of
oil; the impact of increasing competition; conditions in general
economic and financial markets; availability of drilling and
related equipment; effects of regulation by governmental agencies;
future operating costs; uninterrupted access to areas of
TransGlobe's operations and infrastructure; recoverability of
reserves and future production rates; that TransGlobe will have
sufficient cash flow, debt or equity sources or other financial
resources required to fund its capital and operating expenditures
and requirements as needed; that TransGlobe's conduct and results
of operations will be consistent with its expectations; that
TransGlobe will have the ability to develop its properties in the
manner currently contemplated; current or, where applicable,
proposed industry conditions, laws and regulations will continue in
effect or as anticipated as described herein; that the estimates of
TransGlobe's reserves and resource volumes and the assumptions
related thereto (including commodity prices and development costs)
are accurate in all material respects; and other matters.
Forward-looking statements or information are based on current
expectations, estimates and projections that involve a number of
risks and uncertainties which could cause actual results to differ
materially from those anticipated by the Company and described in
the forward-looking statements or information. These risks and
uncertainties which may cause actual results to differ materially
from the forward-looking statements or information include, among
other things, operating and/or drilling costs are higher than
anticipated; unforeseen changes in the rate of production from
TransGlobe's oil and gas properties; changes in price of crude oil
and natural gas; adverse technical factors associated with
exploration, development, production or transportation of
TransGlobe's crude oil reserves; changes or disruptions in the
political or fiscal regimes in TransGlobe's areas of activity;
changes in tax, energy or other laws or regulations; changes in
significant capital expenditures; delays or disruptions in
production due to shortages of skilled manpower equipment or
materials; economic fluctuations; competition; lack of availability
of qualified personnel; the results of exploration and development
drilling and related activities; obtaining required approvals of
regulatory authorities; volatility in market prices for oil;
fluctuations in foreign exchange or interest rates; environmental
risks; ability to access sufficient capital from internal and
external sources; failure to negotiate the terms of contracts with
counterparties; failure of counterparties to perform under the
terms of their contracts; and other factors beyond the Company's
control. Readers are cautioned that the foregoing list of factors
is not exhaustive. Please consult TransGlobe's public filings at
www.sedar.com and www.sec.goedgar.shtml for further, more detailed
information concerning these matters, including additional risks
related to TransGlobe's business.
The forward-looking statements or information contained in this
news release are made as of the date hereof and the Company
undertakes no obligation to update publicly or revise any
forward-looking statements or information, whether as a result of
new information, future events or otherwise unless required by
applicable securities laws. The forward-looking statements or
information contained in this news release are expressly qualified
by this cautionary statement.
Oil and Gas Advisories
Mr. Ron Hornseth, B.Sc., General Manager - Canada for TransGlobe
Energy Corporation, and a qualified person as defined in the
Guidance Note for Mining, Oil and Gas Companies, June 2009, of the
London Stock Exchange, has reviewed the technical information
contained in this report. Mr. Hornseth is a professional engineer
who obtained a Bachelor of Science in Mechanical Engineering from
the University of Alberta. He is a member of the Association of
Professional Engineers and Geoscientists of Alberta ("APEGA") and
the Society of Petroleum Engineers ("SPE") and has over 20 years'
experience in oil and gas.
BOEs may be misleading, particularly if used in isolation. A BOE
conversion ratio of six thousand cubic feet of natural gas to one
barrel of oil equivalent (6 MCF: 1 Bbl) is based on an energy
equivalency conversion method primarily applicable at the burner
tip and does not represent a value equivalency at the wellhead.
Given that the value ratio based on the current price of crude oil
as compared to natural gas is significantly different from the
energy equivalency of 6:1, utilizing a conversion on a 6:1 basis
may be misleading as an indication of value.
References in this press release to production test rates, are
useful in confirming the presence of hydrocarbons, however such
rates are not determinative of the rates at which such wells will
commence production and decline thereafter and are not indicative
of long term performance or of ultimate recovery. While
encouraging, readers are cautioned not to place reliance on such
rates in calculating the aggregate production for TransGlobe. A
pressure transient analysis or well-test interpretation has not
been carried out in respect of all wells. Accordingly, the Company
cautions that the production test results should be considered to
be preliminary.
The following abbreviations used in this press release have the
meanings set forth below:
bbls barrels
boe barrels of oil equivalent of natural gas, on the basis
of one barrel of oil or NGLs for six thousand cubic feet
of natural gas
Boepd Barrels of oil equivalent per day
Bopd barrels of oil per day
Mcf/d thousand cubic feet per day
MMcf/d million cubic feet per day
NGL Natural Gas Liquids
MM million
IP30 Average daily production over first 30 days post-completion
IP60 Average daily production over first 60 days post-completion
Production Disclosure
Production Summary (WI before royalties and
taxes):
----------------------- -----------------------------------------------------------------
(Boepd) Q1 2021 Q2 2021 Jul 2021 Aug 2021 Sep 2021 YTD Average
(to Sep
18(th)
)
------------------------ -------- -------- --------- --------- --------- ------------
Egypt (bbls/d) 10,238 10,727 11,311 11,541 11,214 10,758
------------------------ -------- -------- --------- --------- --------- ------------
Eastern Desert
(bbls/d) 10,052 9,917 10,611 10,874 10,561 10,204
-------- -------- --------- --------- --------- ------------
Heavy Crude (bbls/d) 9,419 9,736 10,429 10,697 10,394 9,868
-------- -------- --------- --------- --------- ------------
Light and Medium
Crude (bbls/d) 633 181 182 177 167 336
-------- -------- --------- --------- --------- ------------
Western Desert
(bbls/d) 186 810 700 667 653 554
-------- -------- --------- --------- --------- ------------
Light and Medium
Crude (bbls/d) 186 810 700 667 653 554
------------------------ -------- -------- --------- --------- --------- ------------
Canada (boe/d) 1,983 2,350 2,230 2,010 1,986 2,144
------------------------ -------- -------- --------- --------- --------- ------------
Light and Medium
Crude (bbls/d) 564 687 643 562 574 617
-------- -------- --------- --------- --------- ------------
Natural Gas (Mcf/d) 4,259 4,834 4,534 4,583 4,764 4,565
-------- -------- --------- --------- --------- ------------
Associated Natural
Gas Liquids (bbls/d) 710 857 832 684 618 766
------------------------ -------- -------- --------- --------- --------- ------------
Total Company (boe/d) 12,221 13,077 13,541 13,551 13,200 12,902
-------- -------- --------- --------- --------- ------------
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