LONDON (Alliance News) - MX Oil PLC Monday said drilling on the Aje 5 production well offshore Nigeria has started in preparation for production to begin before the end of 2015, slightly ahead of its previous guidance.
The oil and gas investment company said the Aje 5 well will take around 70 days to drill, and once completed, the company will re-enter the Aje 4 well. Both of those wells, part of the OML 113 licence, are expected to begin producing in December 2015.
MX Oil only invested in the OML 113 licence offshore Nigeria earlier in July, when it said production was expected to begin in January 2016.
"These two wells represent the first of a three phase development programme of Aje. Phase 1 is targeting first oil in December 2015 and peak gross production of 41 API oil from these two wells is expected to reach 11,000 barrels of oil per day," said the company.
When phase 2 of the project is completed production will increase to 19,000 barrels of oil per day.
Once drilling operations are completed, the wells will be tied back to a Floating Production Storage and Offloading vessel, the Front Puffin, which is currently being refurbished in Singapore ahead of installation and commissioning.
"This is a major milestone for MX Oil. Having only very recently invested in the Aje field via Jacka Resources and with Aje 5 now being spudded, MX Oil is now progressing quickly towards significant near term production," said Chief Executive Stefan Olivier.
In addition, MX Oil said it has received notice to exercise 1.3 million warrants to acquire 1.3 million new shares in the company at an exercise price of 1.0 pence per share.
MX Oil shares were down 2.1% to 3.92 pence per share on Monday morning.
By Joshua Warner; joshuawarner@alliancenews.com; @JoshAlliance
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