AOGL.L Regulatory News (AOGL)

Mayan Energy Ltd / Index: AIM / Epic: MYN/ ISIN: VGG6622A1057 / Sector: Oil and Gas

8 November 2017

Mayan Energy Ltd ("Mayan" or "the Company")

Stockdale Field Development Update

Mayan (AIM: MYN), the AIM listed oil and gas company, is pleased to announce initiation of oil sales, production and next steps in the development of its interest in the Stockdale Oil Field, Wilson County, Texas in which the Company owns a 60% working interest and 45% net revenue interest.

· First revenues at Stockdale expected this week with the commencement of the sale of 265 barrels of oil in the tanks - follows initiation of production operations at the Morris #1 well ('Morris#1)

· Morris #1 is currently producing at a rate of 16-18 bopd and approximately 260 bopd of from the Upper Anacacho (4,823'-27')

o Upper Anacacho formation was identified by the Company's proprietary Roke Quad Neutron electric log during initial operations targeting the Lower Anacacho

· Production from Morris#1 expected to be significantly enhanced following:

o Acid stimulation, which is standard practice on chalk formations, planned next week on the Upper Anacacho to increase natural fracture connectivity inherent to chalks - this is based on strong pressure and fluid levels

o Acquisition of a salt water disposal well being finalised to manage water produced from the Upper and Lower Anacacho formations. This will allow production from both zones to be commingled by removing the sand plug from the Lower Anacacho, which produced at an initial production rate of approximately 4 barrels of oil per hour during the original testing (see announcement dated 19 October 2017)  

o The performance of well is consistent with our expectations. We believe that once stabilised the production will be in the range of 35 - 50 bopd per well and this should be replicated throughout the field.

Eddie Gonzalez, Managing Director, said: "The Morris#1 well at Stockdale provides a live example of our strategy to acquire underperforming assets and enhance production by applying new techniques and technologies. Our proprietary technology identified a new formation from which the well is currently producing at a rate of 16-18 bopd. We expect to build on this following acid stimulation and, once the salt water disposal well is brought online, commence production from the Lower Anacacho, which tested over 74 barrels in an 18-hour period.  Production from both formations, in our view, will result in a strong and sustainable well and we intend to replicate this across the portfolio of existing wells at Stockdale to build a low cost highly cash generative platform.

Together with the commencement of a workover and well stimulation programme at the Forest Hill Field in Texas, the next few weeks will not be short of high impact newsflow as we advance towards our initial 500bopd target." 

Special note concerning the Market Abuse Regulation:

This announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) No 596/2014 ("MAR"). Market soundings, as defined in MAR, were taken in respect of the Subscription, with the result that certain persons became aware of inside information, as permitted by MAR. That inside information is set out in this announcement. Therefore, those persons that received inside information in a market sounding are no longer in possession of inside information relating to the Company and its securities.

**ENDS**

For further information visit www.mayanenergy.com or contact the following:

Notes:

Mayan Energy Limited is an AIM listed (London Stock Exchange) oil and gas energy Company focussed on the redevelopment and enhancement of its upstream oil and gas interests in Oklahoma and Texas.

Technical sign off

All of the technical information, including information in relation to reserves and resources that is contained in this announcement has been reviewed by, Mr Stephen Brock. Mr Brock is a production engineer & member of the Society of Petroleum Engineers who is a suitably qualified person with over 20 years' experience in assessing hydrocarbon reserves and has reviewed the release and consents to the inclusion of the technical information.

Technical Glossary

bopd

means barrels of oil per day. There are 42 gallons (approximately 159 litres) in one barrel of oil, which will contain approximately 5.8 million British Thermal Units.

EUR

Estimated ultimate recovery (EUR) is an approximation of the quantity of oil or gas that is

potentially recoverable or has already been recovered from a reserve or well.

Workover 

The process of performing major maintenance or remedial treatments on an oil or gas well. In many cases, workover implies the removal and replacement of the production tubing string after the well has been killed and a workover rig has been placed on location. This operation saves considerable time and expense.