San Leon Energy PLC Update on investment in Oza Field, Nigeria (4028F)
July 15 2021 - 8:26AM
UK Regulatory
TIDMSLE
RNS Number : 4028F
San Leon Energy PLC
15 July 2021
15 July 2021
San Leon Energy plc
("San Leon" or the "Company")
Update on investment in Oza Field, Nigeria
San Leon, the independent oil and gas production, development
and exploration company focused on Nigeria, notes the announcement
made today by Decklar Resources Inc. ("Decklar Resources") in
Canada.
San Leon has entered into a conditional subscription agreement
with Decklar Petroleum Limited ("Decklar Petroleum"), the local
subsidiary of Decklar Resources, which entitles San Leon to
purchase US$7,500,000 of 10% unsecured subordinated loan notes of
Decklar Petroleum and 15% of the enlarged share capital of Decklar
Petroleum. In addition, Decklar Petroleum and San Leon have entered
into an option agreement which, at San Leon's sole discretion,
entitles San Leon to purchase an additional US$7,500,000 of loan
notes and further Decklar Petroleum shares representing an
additional 15% of the enlarged share capital of Decklar Petroleum.
Further details of these conditional investment agreements can be
found in the Company's announcement of 1 September 2020. This
transaction is still awaiting final conditions precedents to
complete.
Part of the text of Decklar Resources' announcement is set out
below:
"Oza-1 Well Re-Entry Update
-- The drilling rig and related equipment are set up on location
at the Oza-1 well site. The rig has been tested and inspected and
is currently pulling existing tubing out of the well.
-- A cement bond log will then be completed to confirm integrity of the cement behind casing,
-- followed by pulling of 5 1/2 inch casing that is inside 9 5/8
inch casing, running cased hole reservoir well logs, and cleaning
of the well.
-- Perforation operations will then begin and running a testing
tubing string with straddle packers to test the isolated individual
three zones being tested.
-- It is anticipated that initial oil production testing will
then commence, with all crude oil test volumes produced being
immediately exported and sold through the existing production
facilities and pipelines to the Bonny Export Terminal.
-- All approvals and permits have been obtained for the well re-entry, testing and completion
Toronto, Canada -- Decklar Resources Inc. (DKL-TSX Venture) (the
"Company" or "Decklar") is pleased to announce an update to
operations at the Oza-1 well re-entry at the Oza Oil Field in
Nigeria, being performed by the Company's wholly-owned
Nigeria-based subsidiary, Decklar Petroleum Limited.
Rig On-site at Oza-1 Preparing to Commence Operations
Re-entry operations at the Oza-1 wellsite are progressing with
functional testing and inspection of the rig completed, all
approvals granted and the initial work activities of pulling the
existing tubing are under way. and running a cement bond log to
confirm the integrity of the cement behind the casing. After the
existing tubing has been removed from the wellbore, a cement bond
log will be run to confirm the integrity of the cement behind the
casing followed by pulling the 5 1/2 inch casing that is inside the
9 5/8 inch casing and running cased hole reservoir logs. When the
logging is complete and has been analyzed, the well will be cleaned
out and perforation and production testing operations will commence
on the three known oil-bearing zones (L2.2, L2.4 and L2.6). Each
targeted zone will be production flow tested independently, and all
test volumes produced will be exported and sold through the
existing production facilities and pipelines. Once testing of all
three zones is completed, it is anticipated that a final
dual-tubing string completion will be installed, and the L2.2 and
L2.6 zones placed into production based upon successful
testing.
When the Oza-1 re-entry is complete, the drilling rig is then
expected to be skidded on the same drill pad as Oza-1 well to a new
drilling slot and a horizontal development well will be drilled in
the L2.4 zone. It is anticipated that this well will then be placed
on production upon successful testing and completion. The Oza-1
well and new horizontal development well are expected to generate
significant production levels and generate cash flow in a short
time frame utilizing the existing infrastructure in place. The Oza
Oil Field development is planned to then continue with one or two
more re-entries on other existing wells and an additional
development drilling program with a potential for eight to ten
wells to be drilled to achieve full field development. Additional
early production and central processing facilities will be added as
required to accommodate increased production levels from field
development activities.
The Company anticipates that operations for the re-entry of the
Oza-1 well are on track for initial production testing to commence
immediately following perforating and running the testing string.
The Oza Oil Field has significant export and production capacity
through processing facilities and infrastructure already in place
and operational, which will allow for the immediate export and sale
of crude oil from the Oza-1 well.
Decklar also continues to pursue and advance evaluations and
negotiations for additional proven undeveloped oil and gas fields
in Nigeria that have significant reserves and near-term production
potential, including the recently announced acquisition in the
Asaramatoru oil field ."
Enquiries:
San Leon Energy plc +353 1291 6292
Oisin Fanning, Chief Executive
Allenby Capital Limited
(Nominated adviser and joint broker to the Company) +44 20 3328 5656
Nick Naylor
Alex Brearley
Vivek Bhardwaj
Panmure Gordon & Co
(Joint broker to the Company) +44 20 7886 2500
Nick Lovering
Brandon Hill Capital Limited
(Joint broker to the Company) +44 20 3463 5000
Oliver Stansfield
Jonathan Evans
Tavistock
(Financial Public Relations) +44 20 7920 3150
Nick Elwes
Simon Hudson
Plunkett Public Relations +353 1 230 3781
Sharon Plunkett
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