Like him or hate him!!27 Apr 2020 17:32
“Malcy’s blog Today..
Hurricane Energy
Hurricane have provided a detailed operational update today ahead of the Capital Markets Event held this morning. The data gathering has been declared ‘a resounding success’ with both wells capable of producing at least 10,000/- b/d and a combined rate of up to a maximum of 20,000/- excluding downtime, is currently being tested. The water content is higher than expected but still considered to be perched and attributed to a 10m zone in the 7Z well.
Production averaged 14,900 b/d in the 1st quarter, noting that this included a month of production from just the 6 well, with 18,500 b/d in April 2020 and updated production guidance for the year is 18,000 b/d for the balance of the year averaging 17,000 b/d. Also the Aoka Mizu FPSO has delivered excellent availability of 96% since start-up.
At GWA the JV is seeking a field determination area, with the Lincoln Crestal well suspension consent deferred until 30th September 2020 for COVID-19 reasons the field development solution is still either via a single well tie to the Aoka Mizu of either the existing Lincoln Crestal well or an alternative horizontal shallower producer.
The Lancaster EPS has delivered approximately five months of steady production data due to commissioning activities, various shutdowns and testing which has shown reservoir behaviour to be more complex than anticipated and needs a more extended period of steady production to confirm validity of the Hurricane volumetric model. The next steps for Lancaster include continuing testing of the two existing wells, a volumetric review including a CPR to be produced in early 2021 with data as at end 2020, a call on the Lancaster commitment well and then proceeding to extend the Aoka Mizu FPSO contract. Options to drill and tie-back a prospective ‘L8’ well to not only increase production but also provide data to help de-risk the Company’s volumetric model and re-entering the 205/21a-7Z well are being reviewed in the light of the current oil price.
With the two wells, material balance estimates and recent pressure decline trends are consistent with the two wells being currently connected to a with a minimum in-place volume of around half a billion barrels. Bottom hole pressure response suggests that the wells are obtaining more pressure support with increased production, progressively ‘seeing’ more of the reservoir. This was a very detailed event with much more data I can talk about later but this fact along with operating costs of $17 pb and a cash balance of $152m means that Hurricane is in very robust shape with a good deal of potential upside.”
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