San Leon, the specialist oil and gas company with an extensive portfolio of assets across Europe and North Africa, notes this morning's announcement from Providence Resources plc ("Providence") of the technical update by Providence on the Barryroe oil discovery in the North Celtic Sea Basin, offshore Ireland. San Leon announced, on 23 December 2011, that the Company has assigned its 30% working interest in Standard Exploration Licence 1/11 to Providence in exchange for a 4.5% NPI on the full field. San Leon Energy will not pay any further appraisal or development costs on the Licence and is not paying any costs towards the 48/24-10 well.
The full announcement by Providence stated the following:
BARRYROE WELL TEST ANALYSIS CONFIRMS PRODUCTIVITY POTENTIAL
· WELL TEST ANALYSIS INDICATES HIGH PERMEABILITY BASAL OIL BEARING RESERVOIR INTERVAL
· HORIZONTAL DEVELOPMENT WELLS PREDICTED TO DELIVER SIGNIFICANT PRODUCTION RATES
Providence Resources P.l.c., ("Providence") the Irish oil and gas exploration and production company, whose shares are quoted in London (AIM) and Dublin (ESM), is pleased to provide a technical update on the Barryroe oil discovery in the North Celtic Sea Basin, offshore Ireland. Providence (80%) operates Barryroe on behalf of its partner Lansdowne Oil and Gas plc. The area lies in c. 100 metre water depth and is c. 50 km off the south coast of Ireland.
A comprehensive programme of post-drill studies is continuing in order to better define the Barryroe oil in place resource and potential recoverable reserves. In early May (see RNS of May 10th), the first of these studies detailing results of seismic inversion work confirmed that the basal hydrocarbon bearing sandstone package can be directly mapped from 3D seismic data. These data also indicated that this basal reservoir sequence is widely developed in the Barryroe area.
Providence has completed further analysis of the 48/24-10z well test data which were acquired by Schlumberger during well testing operations. The data were analyzed using a leading wellbore modeling software system to determine the potential Initial Production (IP) rates achievable from a single horizontal development well. This analysis indicates that the tested basal oil bearing sandstone package is of high quality with an average test derived permeability of c. 400 millidarcies, confirming the high productivity potential as demonstrated during the well testing operations. The analysis forecasts that a 1,000' horizontal well could deliver an IP of c. 12,500 BOPD & c. 11 MMSCFD (c. 14,300 BOEPD) through a standard 4.5" outer diameter (OD) production tubing under natural lift. Further well deliverability analysis and optimization studies are ongoing to incorporate artificial lift which is expected to form part of the field development plan. Updated oil in place estimates are expected to be finalised during Q3 2012 with the estimated recoverable reserves and associated development concept being available in Q4 2012.
Speaking today, John O'Sullivan, Technical Director of Providence said,
"We had anticipated that we were dealing with a high productivity oil system both in terms of oil mobility and reservoir development. These figures now confirm the magnitude of that productivity potential and clearly demonstrate that the Barryroe basal sands could potentially deliver oil at significantly higher production rates than was previously modeled. This obviously has an important effect on the forward development planning and potential production profiles and should serve to increase the project valuation. In addition, given that the seismic modeling is allowing us to directly map the reservoir interval from the 3D seismic data, we are now in a better position to plan for horizontal wells and benefit from their associated material incremental well production rates."
John Buggenhagen, who has reviewed this update, has over 15 years experience in the oil & gas industry. He has a Ph.D. and M.Sc. in Geophysics from the University of Wyoming and a B.Sc. in Geophysics from the University of Arizona. He is currently the Director of Exploration for the San Leon Energy Group and based in San Leon's Warsaw office in Poland.
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