22 Dec 2017 08:00
Mayan Energy Ltd / Index: AIM / Epic: MYN/ ISIN: VGG6622A1057 / Sector: Oil and Gas
22 December 2017
Mayan Energy Ltd ("Mayan" or "the Company")
Operations Update - Kelly Lynne (Anacacho) & Forest Hill Fields
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Mayan (AIM: MYN), the AIM listed oil and gas company, is pleased to announce additional progress in its development program at the Kelly Lynne (Anacacho) Field at Stockdale, Wilson County, Texas in which the Company has a 60.0% working interest (WI) and 45.0% net revenue interest (NRI) and Forest Hill Field, Wood County Texas in which the Company has a 70.0% WI and 52.5% NRI.
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Forest Hill Field, Wood County, Texas:
路 Acquisition of additional three (3) wells adjacent to the Forest Hill lease agreed in principle - terms being finalised and anticipated to be on the same basis as the Forest Hill lease; to be funded from existing cash reserves
路 A workover rig has been sourced and will be on site in the week of December 25th to immediately commence work to bring the three new wells into production - average workover takes 4 days
路 The approvals process, controlled by the Railroad Commission ("RRC"), for the transfer of operations on six (6) Forest Hill wells acquired, is expected to be completed shortly. Once approved, five (5) wells will be worked over utilising the contracted rig, which is expected to commence in early 2018
路 The Gilbreath #19 well produced at an average rate of 43 bopd as announced on 14 November. This well is ready for immediate production once RRC approval is granted
路 On completion of the above acquisition and permitting, the Company will have nine [9] wells which, in tandem with its operating partner, will seek to produce and workover during the latter part of December and early 2018
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Kelly Lnne (Anacaho) Field (at Stockdale), Wilson County, Texas:
路 Further to the announcement of 8 November 2017, an Agreement has been reached to use a permitted water injection well on a 93.07-acre land tract contiguous and offsetting the Morris lease (Morris #1 well). The Company intends to lay a 1,500' water disposal line from its productive Morris #1 well to the injection well on this adjacent tract to dispose of the water produced from Morris. It is envisaged that additional wells on the tract may be converted to water injection wells as needed. The addition of a water injection well will facilitate enhanced production from the Morris #1 well and allow commingling of production from the Upper and Lower Anacacho formation
路 The Company has engaged a land and lease acquisition specialist (landman) to acquire additional leases and wells for workover and/or re-completion in the area around the Morris #1 well. The Directors believe the team can replicate the work being conducted to raise production on its existing properties and increase the Company's portfolio size and production
路 The Company expects that production from the Morris #1 well will be in the 35-50 bopd range
路 The first shipment (load) of oil totalling 167.5 barrels barrel was sold from the Stockdale well and a second shipment (load) will be picked up shortly
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Zink Ranch Field, Osage County, Oklahoma
路 Due to a longer than anticipated process for assumption of and recognition by Federal and Osage tribal authorities of operatorship status at Zink Ranch, the work program announced 31 October 2017 has been postponed. The administrative process is underway, and the Company expects to announce its plans with respect to initiation of Zink Ranch development in the New Year
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Eddie Gonzalez, Managing Director, said: "This has been a year of transition and we believe we have built a strong platform from which to execute our growth strategy. We have demonstrated our ability to identify undervalued projects that can be optimised and enhanced, as shown by the sales from Stockdale. Once we have finalised permits with the Railroad Commission we will immediately implement the workover programmes which will further transform our production profile and make significant strides to meeting our initial production target of 500 bopd.
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"We are targeting at least seven (7) wells on production by the end of January across Stockdale and Forest Hill. With both Forest Hill and Stockdale then being cash flowing assets we can move on to identifying additional well opportunities on the acreage, identifying further assets and investment opportunities, such as our Deloro investment, to raise production and build value."
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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").
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**ENDS**
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For further information visit www.Mayanenergy.com or contact the following:
Eddie Gonzalez | Mayan Energy Ltd | + 1 469 394 2008 |
Charlie Wood | Mayan Energy Ltd | +44 7971 444 326 |
Roland Cornish | Beaumont Cornish Ltd | +44 20 7628 3396 |
James Biddle | Beaumont Cornish Ltd | +44 20 7628 3396 |
Nick Bealer | Cornhill Capital Limited | +44 20 7710 9612 |
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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.
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Technical sign off
All of the technical information, including information in relation to reserves and resources that are contained in this announcement, have been reviewed by Mr. Stephen Brock. Mr. Brock is a production engineer and member of the Society of Petroleum Engineers and 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.