(Alliance News) - IGas Energy PLC said Monday it began the execution phase on a new project at its gas project in the East Midlands.
The gas firm reported its technical team had identified another opportunity at its Welton field, with it now moving to the execution phase for the waterflood project.
The project would see IGas convert a suspended production well - WC01 - to water injection in order to increase reservoir sweep. This could increase field recovery by 340 million barrels of 2C resources, with a peak production rate of up to 120 barrels of oil per day.
IGas estimates the mid-case project economics will have an internal rate of return above 100% and a net present value of GBP7.0 million.
"We continue to mature projects across the portfolio as we seek to maximise returns on our existing operations and infrastructure, and in this case are pleased to be moving forward with another low-risk opportunity with an estimated mid-case IRR of over 100%," Chief Executive Officer Stephen Bowler said.
"This is part of the wider Welton full field development and as well as increasing production, will aid in de-risking further injection projects into other areas of the field and provide critical infrastructure to assist with water disposal and support future rationalisation work across Welton sites", Bowler added.
Shares in IGas were 3.2% lower at 51.40 pence in London on Monday.
By Ahren Lester; ahrenlester@alliancenews.com
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