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(Alliance News) - Block Energy PLC announced on Monday that good progress had been made with testing at its JKT-01Z well.
Shares in Block Energy were up 7.1% at 1.50 pence on Monday morning in London.
The London-based oil and gas company with projects focused in Georgia said JKT-01Z's initial production rates were 344 barrels of oil equivalent per day, comprising of 241 barrels of oil per day and 17,500 metres cubed of gas per day.
Block Energy said this will add nearly USD500,000 additional cash revenue per month based on its current production rates and sales prices. Excluding capital expenditure, the company said this additional revenue will make its cashflow positive.
As a result of improved agreement terms and an improved market, the company said its first quarter gas price price will be over 30% higher than the price achieved in the second half of 2021.
JKT-01Z was drilled along 597 metres of horizontal reservoir section. The top of the reservoir was encountered shallower than expected. This, Block Energy explained, resulted in a significant increase in estimated reservoir volume which, in turn, is expected to enhance resource and reserves volumes.
Block Energy said the success at JKT-01Z enhances its confidence to further optimise drilling within the field.
Chief Executive Paul Haywood said: "Well JKT-01Z sets a new standard on time and cost for such a sidetrack in our Georgian operation. It has also been delivered with an exceptional safety record. The success of this well represents a milestone for the company, with Block Energy becoming cashflow positive, opening the opportunity to create and deliver additional value to shareholders."
By Heather Rydings; heatherrydings@alliancenews.com
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