LONDON (Alliance News) - Egdon Resources PLC on Friday published data on the extended well test operations conducted on the Penistone Flags and Ashover Grit reservoirs at the Wressle-1 oil and gas well, in Lincolnshire, England, which provided encouraging flow data on the Penistone zone.
Egdon is the operator of the licence with a 25% stake. Fellow AIM-listed firm Europa Oil & Gas (Holdings) PLC, which also noted Egdon's announcement on Friday, has a 33.3% working interest, with another 33.3% held by Celtique Petroleum and 8.3% held by Union Jack Oil PLC, which also is listed in London.
Egdon said operations at the Penistone Flags oil zone have now been suspended, with the planned oil injection to determine the permeability of the reservoir not undertaken due to delays by the UK's Environment Agency in clarifying whether the current permit Egdon holds for the well permits it to do this.
In testing conducted to date, no evidence of water has been seen and, Egdon said the well test and log data has indicated the elevation of the oil water contact is deeper than had been thought for the Penistone Flags reservoir. Egdon said it will now undertaken further testing to establish the nature of the fluids in the lowermost part of the reservoir.
Plans for a workover of the well are currently being finalised, Egdon said.
For the Ashover Grit reservoir, however, it has so far not been possible to re-establish flow rates during the extended well test, either due to a mechanical problem with the down-hole completion, an annular blockage or an impairment of the perforations caused by the well completion operations, Egdon said.
A new workover will be undertaken on the well and a programme of remedial work will be initiated, should that be required. Egdon expects Ashover Grit operations to resume in late September or early October.
"Development of the Penistone Flags reservoir will require careful positioning of any future well to optimise oil production from this interval in which we have seen a higher level of gas than in other reservoir intervals. The planned additional test is designed to gain the appropriate information in the most cost-effective manner whilst also evaluating radial drilling which is one of the potential development options being considered for this interval," said Egdon managing director Mark Abbott.
Shares in Egdon were untraded on Friday morning, having last traded at 12.55 pence. Europa shares were down 1.7% to 5.0375 pence, while Union Jack Oil shares were up 1.2% to 0.172 pence.
By Sam Unsted; samunsted@alliancenews.com; @SamUAtAlliance
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