TIDMPTR
RNS Number : 2096D
Petroneft Resources PLC
05 July 2016
PetroNeft Resources plc
("PetroNeft" or the "Group" or the "Company")
Operations Update
PetroNeft (AIM: PTR) an oil & gas exploration and production
company, operating in the Tomsk Oblast, Russian Federation, and 50%
owner and operator of Licences 61 and 67, is pleased to announce
the completion of a successful three well initial development
programme on the southern extension of Arbuzovskoye in Licence 61
and the addition of a fourth well based on the positive
results.
Highlights
Third successful well drilled at South Arbuzovskoye
Fourth well added as follow-up
Record production achieved
Production
-- Current gross production from Licence 61 increased to about
3,500 bopd (1,750 bopd net to PetroNeft).
-- Increase due to three strongly performing new wells at Arbuzovskoye.
-- This is the all-time record high production for the Licence area.
Arbuzovskoye Well A-213 - Vertical Production Well
-- Initial well discovered oil for the first time in the secondary J1-2 interval at Arbuzovskoye.
-- Perforations have now been added to the J1-1 interval.
-- The combined production from the J1-1 and J1-2 intervals is greater than 350 bopd.
Arbuzovskoye Well A-214 - Horizontal Production Well
-- Initial horizontal well with record 931 m net pay.
-- Current rate of production in excess of 750 bopd with 5 % water.
Arbuzovskoye Well A-215 - Horizontal Production Well
-- Recently completed horizontal well with 809 m net pay.
-- Current rate of production is 650 bopd with 5 % water.
Arbuzovskoye Well A-216 - New Deviated Production Well
-- New well added to programme based on results of initial three wells.
-- Spudded on 20 June 2016
-- Results anticipated later this month.
Sibkrayevskoye Well S-374 - Vertical Delineation Well
-- Spudded on 3 July.
-- Results expected in August.
South Arbuzovskoye Development
As previously announced, the initial well in the programme was
the A-213 vertical well. This well discovered oil in the J1-2
interval for the first time at Arbuzovskoye. The well was initially
produced in just the J1-2 interval. Since the previous update
perforations were added to the J1-1 interval on 14 June. The
combined production from the J1-1 and J1-2 intervals in the well is
now over 350 bopd which is well above the Company's original
expectation of an initial rate of 125 bopd.
As also previously announced, the first horizontal well in the
programme was A-214. This well had a record net pay of 931 m for
Licence 61. The well is producing approximately 750 bopd and
demonstrating positive pressure characteristics.
The second horizontal well, A-215, was spudded on 21 May 2016
and has been successfully completed with a horizontal segment of
1,007 m in the Upper Jurassic J1-1 interval at a depth of
approximately -2,457 to -2,475 m TVDSS. Based on log data it is
estimated that 809 m of the horizontal section is effective net
pay. The A-215 well was brought online on 24 June and the current
flow rate is around 650 bopd. The well has cleaned up and is
producing about 5% water. The intake pressure in the well is
relatively stable, which indicates that additional production
capacity may exist.
The pressure data from both the A-214 and A-215 horizontal wells
indicates that the wells are pump constrained and could produce at
a higher rate; however, the current plan is to keep producing in
this mode and monitor the wells to optimise long term production
performance. This will lessen the decline rate in the horizontal
wells.
The Arbuzovskoye well A-216 was spudded on 20 June 2016. Well
A-216 is a deviated (vertical in the reservoir) production well
located to the south of well A-213. The well was not in the
original firm work programme but has been added based on the good
results of the A-213, A-214 and A-215 wells. It provides an
additional drainage point on the southern end of the structure and
targets the J1-1 and J1-2 intervals as seen in the A-213 well. Core
taking in the J1-1 and J1-2 intervals in the well will provide
additional data on the reservoir as well as the oil water contact
in the J1-2 sandstone. The results of this well should be available
later this month.
Production
Current gross production from Licence 61 is about 3,500 bopd
(1,750 bopd net to PetroNeft). This represents record production
for the Licence area and has resulted from the good results of the
initial three wells at Arbuzovskoye, despite the high decline rate
encountered at Tungolskoye and the shut-in of the S-373 well for
the summer months following the end of the winter road season. The
production results thus far at South Arbuzovskoye confirm that
while there is some decline, it is not of the magnitude of decline
experienced at Tungolskoye. This is due to the excellent reservoir
properties and the thickness of the reservoir at Arbuzovskoye as
compared to Tungolskoye.
Sibkrayevskoye Development
The S-374 delineation well was spudded on 3 July 2016. This is a
delineation well on the southern portion of the field designed to
further de-risk the development and move P3 to P2 reserves. All of
the necessary studies and approvals are being completed in order to
commence development of Sibkrayevskoye in Q1 2017.
Dennis Francis, Chief Executive Officer of PetroNeft Resources
plc, commented:
"Licence 61 production has achieved a record rate of 3,500 bopd
due to the successful programme at South Arbuzovskoye. Also, in
light of this success, we have added one further well to the
programme that is not yet on production. The production reflects
both the good reservoir properties at South Arbuzovskoye and our
ability to target the most productive parts of the reservoir with
horizontal wells. This exceptional technology will help us to
economically and efficiently develop the significant reserve base
and exploration potential of Licence 61.
In the near term we look forward to completion of the A-216 well
at South Arbuzovskoye which will add production and the S-374
delineation well at Sibkrayevskoye which will further define the
field with the objective of moving P3 to P2 reserves."
For further information, contact:
Dennis Francis, CEO, PetroNeft Resources +1 713 988
plc 2500
Paul Dowling, CFO, PetroNeft Resources +353 1 443
plc 3720
John Frain/Brian Garrahy, Davy (NOMAD +353 1 679
and Joint Broker) 6363
Henry Fitzgerald-O'Connor, Canaccord +44 207
Genuity Limited (Joint Broker) 523 8000
Martin Jackson/Shabnam Bashir, Citigate +44 207
Dewe Rogerson 638 9571
Joe Heron / Douglas Keatinge, Murray +353 1 498
Consultants 0300
The information contained in this announcement has been reviewed
and verified by Mr. Dennis Francis, Director and Chief Executive
Officer of PetroNeft, for the purposes of the Guidance Note for
Mining and Oil & Gas Companies issued by the London Stock
Exchange in June 2009. Mr. Francis holds a B.S. Degree in
Geophysical Engineering and a M.S. Degree in Geology from the
Colorado School of Mines. He has also graduated from the Harvard
University Program for Management Development. He is a member of
the American Association of Petroleum Geologists and the Society of
Exploration Geophysicists. He has over 40 years' experience in oil
and gas exploration and development.
Glossary
2P reserves Proved and probable reserves as
defined by the standards of the
Society of Petroleum Engineers
------------ ---------------------------------
Atm Atmospheres of pressure, metric
pressure unit.
------------ ---------------------------------
bopd Barrels of oil per day
------------ ---------------------------------
M metres
------------ ---------------------------------
MD Measured depth
------------ ---------------------------------
P2 reserves Probable reserves as defined by
the standards of the Society of
Petroleum Engineers
------------ ---------------------------------
P3 reserves Possible reserves as defined by
the standards of the Society of
Petroleum Engineers
------------ ---------------------------------
TVDSS True vertical depth subsea
------------ ---------------------------------
This information is provided by RNS
The company news service from the London Stock Exchange
END
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