LONDON (Alliance News) - Frontera Resources Corp shares jumped higher in opening trade on Monday after the company said internal estimates indicate a big upgrade to its resources estimate at the Mtsare Khevi gas complex in Georgia, and it said it has completed drilling at one well and is due to start work on another by the end of the month.
Frontera shares were up 15% to 0.888 pence in early trade, putting it among the best performers on the AIM All-Share.
The oil and gas company said recently-concluded internal geological studies undertaken at Mtsare Khevi have increased the gas in place estimates for the site from up to 1.2 trillion cubic feet to up to 11 trillion cubic feet, with up to 9 trillion cubic feet of recoverable gas possible from reservoir targets found between depths of 300 metres and 5,000 metres.
Frontera also said the area of prospectivity has been increased by approximately 80 square kilometres, increasing the total area at Mbsare Khevi to 140 sq km.
An independent assessment of Frontera's internal estimates will start in the fourth quarter, the company said.
The oil and gas explorer also said drilling at Well 32a at Mtsare Khevi was started in July and has now been completed. It said it successfully encountered 20 metres of pay sands at a depth of 330-350 metres, with testing showing this will be capable of delivering up to 700 million cubic feet per day of gas.
An additional 25 metres of pay sands were found in the well, and these are to be placed into production by Frontera over time, it said. The well is currently in the process of being connected to Frontera's gas gathering and sales infrastructure.
Frontera said work is underway to commence drilling at the next well, Well 34, at the site and is due to start before the end of this month.
By Sam Unsted; samunsted@alliancenews.com; @SamUAtAlliance
Copyright 2014 Alliance News Limited. All Rights Reserved.
