Mosman Oil & Gas Share News (MSMN)

(Sharecast News) - Energy explorer, developer and producer Mosman Oil and Gas updated the market on initial production from the Cinnabar-1 well in Tyler County, Texas on Friday.

The AIM-traded company said that on 28 December, the well was completed and perforated in the Upper Wilcox sands between 9,042 and 9,052 feet, and between 9,098 and 9,108 feet.

On 3 and 4 January, the well was flow tested by Streamline Well Testing.

The average flow over 24 hours on a 10/64-inch choke was around 120 barrels of oil and 180 million standard cubic feet of gas per day, for a total of about 150 barrels of oil equivalent per day, while the final wellhead pressure was 1,025 psi.

Mosman said the longer-term stable flow rates for both oil and gas would be determined after Cinnabar-1 was connected to the existing production facilities that have oil tanks, gas separation and gas export capability.

The pipeline from the well to the production facility was currently being installed.

As of 6 January, the well had produced more than 1,000 barrels of oil, which was being stored in temporary tanks, with arrangements being made for it to be transported and sold.

Mosman said it had already engaged independent consulting engineers to upgrade the reserve report with information from the well, while planning had also started for workovers of the existing wells and drilling of additional development wells.

Mosman owns a 75% working interest in the well and the 350-acre lease, with its subsidiary Mosman Operating acting as operator.

"These initial flow rates are very positive," said chairman John Barr.

"We continue to move forward to full scale production and sales of both oil and gas at Cinnabar.

"The board is very pleased that the investment in the Cinnabar lease is delivering such encouraging results."

At 1618 GMT, shares in Mosman Oil and Gas were down 3.7% at 0.07p.

Reporting by Josh White for Sharecast.com.