TIDMEME
RNS Number : 1132J
Empyrean Energy PLC
26 June 2017
This announcement contains inside information
Empyrean Energy PLC / Index: AIM / Epic: EME / Sector: Oil &
Gas
26 June 2017
Empyrean Energy PLC ("Empyrean" or the "Company")
Mako South-1 Well Drilling and Testing Update
-- Mako South-1 Well successfully reaches Total Depth of 1,707 feet
-- 99% of conventional core recovered from target zone
-- Modern suite of logs taken over target zone
-- 23 feet of net gas pay interpreted from logs
-- The main target Upper Intra Muda gas bearing sands exhibit
better than expected porosity, permeability and gas saturation from
initial log interpretation
-- Testing operations have commenced with gas flowing to surface
Empyrean, the oil and gas development company with interests in
China, Indonesia and the United States, is pleased to announce that
it has been advised by the operator of the Duyung PSC in the Natuna
Basin Offshore Indonesia, Conrad Petroleum ("Conrad") that the Mako
South-1 well has reached its planned Total Depth ("TD"). Coring and
logging is completed and testing is underway.
Since the 21 June 2017 update, drilling operations to acquire a
conventional core of the target zone of interest was successful
with approximately 99% recovery. Following the recovery of core,
the well was drilled to its planned TD of 1,707 feet. Hepta Combo
logs were then successfully run. Subsequently, MDT logs were
successfully run. The well is currently undergoing a Drill Stem
Test ("DST") to establish an indicative flow rate. Further updates
will be made once a stabilized flow rate including gas quality and
pressure data has been acquired.
Prior to the DST, interpretation of the logs established 23 feet
of net gas pay from the main target, the Upper Intra Muda Sands.
Importantly, the logs are exhibiting better porosity, permeability
and gas saturation than originally modelled.
Further work will now be carried out on the core and it is
likely that as previously planned, a 3D seismic survey over the
discovery will be carried out to obtain a better understanding of
the reservoir size and characteristics.
Further announcements will be made in due course as testing and
appraisal continues.
Tom Kelly, Empyrean CEO, commented:
"Whilst we have further work to do at Mako to determine the
overall size of the potential gas accumulation, Empyrean is
extremely pleased that our aggressive exploration programme has
kicked off with great success. We have a gas discovery with
excellent reservoir quality here at the Mako South-1 well location,
our first exploration well since we have re-established Empyrean
with exciting new assets. Empyrean has set out to build a core
portfolio of potentially transformational exploration assets in
prolific hydrocarbon basins, close to infrastructure and energy
hungry markets. We have achieved this first stage of our strategy
in a relatively short time frame, and now we have our first
exploration success with many more chances to come in the
near-term. Mr Frank Brophy and Mr Gaz Bisht must be commended for
their efforts in this regard. In relation to our opportunity at the
Duyung PSC, in Indonesia, we commend the operator Conrad Petroleum
for their professional approach, planning and execution thus far of
the Mako South-1 drilling and testing programme. They have exceeded
our expectations with regards to timeframes while keeping to
budget. These are certainly exciting times for Empyrean and its
joint venture partners. We look forward to providing further
updates on testing in the short term."
**ENDS**
For further information:
Empyrean Energy plc
Tom Kelly Tel: +61 8 9481 0389
Cenkos Securities plc
Neil McDonald Tel: +44 (0) 131 220 9771
Beth McKiernan Tel: +44 (0) 131 220 9778
Nick Tulloch Tel: +44 (0) 131 220 9772
St Brides Partners Ltd
Lottie Brocklehurst Tel: +44 (0) 20 7236 1177
Olivia Vita Tel: +44 (0) 20 7236 1177
The information contained in this announcement was completed and
reviewed by the Company's Technical Director, Mr Frank Brophy, who
has over 40 years' experience as a petroleum geologist.
Notes to Editors
About Empyrean Energy Plc (LON: EME)
Empyrean is a London AIM listed oil and gas explorer with three
potentially high impact new projects. Empyrean has a 1800km2
offshore oil permit located in the Pearl River Mouth Basin, China
where it has commenced 3D seismic Q2, 2017 to further mature two
large oil prospects, Jade and Topaz. The permit is directly South
East of the billion barrel+ Liuhua Oil Field operated by CNOOC and
two recent discoveries to the permits West and South further
enhance the merit of Jade and Topaz. Empyrean is operator and holds
100% of the exploration rights through to commercial discovery
where CNOOC have a back-in right to 51%.
Empyrean also has a 10% interest in West Natuna Exploration
Limited that holds 100% of the Duyung PSC in offshore Indonesia and
is targeting the Mako Shallow Gas Discovery that has an
independently verified 2C and 3C gas resource of between 430-650
Bcf recoverable gas. Empyrean is currently participating in
drilling the Mako South-1 well which is planned to take core, run a
full suite of modern logs and conduct a flow test. Conrad Petroleum
is the operator and 90% interest owner in the Mako South - 1 well
and Duyung PSC.
Empyrean also has a joint venture with ASX listed Sacgasco
Limited on a suite of projects in the Sacramento Basin, onshore
California, USA. The package includes two mature, multi-Tcf gas
prospects, 'Dempsey' (Empyrean earning 30%) and 'Alvares' (Empyrean
earning 25%) and an Area of Mutual Interest (the "Dempsey Trend
AMI")(Empyrean earning 30%) that includes at least three already
identified, large Dempsey-style follow up prospects. Dempsey is a
large structure mapped with 3D seismic and interpreted by Sacgasco
to have the potential to hold a prospective resource of over 1 Tcf
of gas in up to seven stacked target reservoirs. The Company plans
to commence a 3,200 metre (10,500 feet) combined appraisal and
exploration well, Dempsey-1, in Q3 2017 to evaluate this
prospect.
Aside from compelling technical merit, the Dempsey-1 well
location sits next to existing gas metering and surface
infrastructure that is owned by the joint venture. This will allow
for any gas discovery to be tested and connected into the local
pipeline at relatively low cost and in an accelerated timeframe.
This early potential for short-term cash flow in the event of a
commercial discovery would be significant for the joint venture and
for the state of California where gas demand is high and
approximately 90% of consumption is imported from other states. Gas
produced in the Sacramento Basin currently prices at a 10-15%
premium to Henry Hub Gas Prices. The joint venture will be drilling
and testing the Dempsey Prospect, a 1 Tcf gas target in Q3,
2017.
Alvares is a large structure mapped with 2D seismic and
interpreted by Sacgasco to hold prospective resources of over 2 Tcf
estimated potential recoverable gas. A well drilled by American
Hunter Exploration Limited in 1982 for deeper oil intersected
5,000ft of gas shows. No valid flow test was conducted due to
equipment limitations and the deeper oil target failing. However
minor gas flows to surface were recorded even with these
limitations. The possibility of using the existing well bore to
sidetrack and get a valid flow test, thus reducing costs will be
examined.
The Dempsey Trend AMI is an Area of Mutual Interest extending to
approximately 250,000 acres and containing the Dempsey prospect
(described above) as well as at least three other, Dempsey-style
prospects which have been identified on existing seismic.
www.empyreanenergy.com
This information is provided by RNS
The company news service from the London Stock Exchange
END
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