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22 Dec 2008 14:48
22 December 2008 Northern Petroleum Plc ("Northern" or "the Group") Encouraging Gas Testing Operations
Northern Petroleum Plc announces that its wholly owned subsidiary, Northern Petroleum Nederland B.V. has been flaring gas as part of a programme of well remediation work-overs followed by hydraulic fracturing of the reservoir formation to confirm and possibly improve gas production flow rates. This has been reported in The Netherlands press and elsewhere.
The flares look impressive to onlookers. Coming to a reliable fully informed opinion takes a little time. The wells are first flowed to clean up residual liquids and solids from the fracture operations then flow test measurements taken at different pressures. The results are then analysed to provide better gas and condensate production rate forecasts for confirmation of development design and sales contracts.
The on-site works and flow tests have been completed at Wijk en Aalburg and at Brakel, where a second flare stack was installed to take the volume and reduce noise and heat radiation. Down-hole works have also been conducted at Grolloo to prepare the well for hydraulic fracturing operations.
Northern will announce a summary of the Wijk en Aalburg and Brakel results when the analyses are complete in order to avoid over optimistic interpretation of any flow rates from selected parts of the test period.
In early 2009 this five field programme of work will move on to the Geesbrug and Ottoland fields.
The programme is being undertaken to strengthen confidence in production forecasts prior to negotiating gas sales contracts. Production forecasts will only be increased once the required confidence levels are established.
Subject to finalising the EBN participation in all the licences, the interests in all five fields are:
Northern Petroleum Nederland, (Operator) 45%
EBN 40%
Dyas 15%
Derek Musgrove, Managing Director, Northern, stated:
"We are pleased to be moving ahead now with the five fields with existing production wells and must look forward to the test results with a degree of optimism.
"The process of obtaining permissions from numerous authorities has required patience from management and shareholders alike. It is not over, but it is satisfying to be conducting operations again.
"We are endeavouring to be as informative and helpful as possible to our immediate neighbours in The Netherlands and will take into account any concerns and difficulties our operations might cause. This is important as we intend to be a good neighbour. We are grateful for their intelligent understanding of our operations."
In accordance with the AIM Rules - Guidance for Mining and Oil & Gas Companies, the information contained in this announcement has been reviewed and signed off by the Exploration and Technical Director of Northern, Mr Graham Heard CGeol FGS, who has over 30 years experience as a petroleum geologist.
For further information please contact:
Northern Petroleum Plc Tel: +44 (0) 20 7469 2900Derek Musgrove, Managing DirectorChris Foss, Finance DirectorGraham Heard, Exploration & Technical DirectorInvestec Tel: +44 (0) 20 7597 5000Michael Ansell / Patrick RobbBlue Oar Tel: +44 (0) 20 7448 4400Jerry Keen / Toby GibbsBishopsgate Communications (Press) Tel: +44 (0) 20 7562 3350
Nick Rome / Maxine Barnes
Buchanan Communications (Analysts) Tel: +44 (0) 20 7466 5000
Tim Thompson / Ben Romney
Notes to Editors:
Northern has recoverable Proven and Probable reserves of 76.5 million barrels of oil equivalence.
Following a deal with the joint Shell and ExxonMobil subsidiary, NAM, Northern became the Netherland's second largest onshore oil company in terms of oil and gas reserves, 45.5 million boe recoverable. It is currently producing gas at Waalwijk and the offshore P12 fields. The planned development of six onshore oil and gas fields is being progressed through the Netherlands authorisation and planning processes. Partners in these projects include Dyas B.V., EBN and NAM. Northern recently sold its interest in the Waalwijk UGS application for an overall consideration of ‚£10 million.
Northern manages the largest licensed exploration area in Italy, over 13,000 km ‚², predominantly offshore but includes seven licences in the Po Valley oil and gas province in the north of the country where the drilling of the Savio 220 bcf gas prospect is being progressed. Through its holdings in licences in the southern Adriatic covering the Rovesti and Giove oil discoveries it has net Probable oil reserves independently assessed at 26.6 million barrels recoverable. It has recently signed a deal with Shell Italia refunding Northern's past costs and providing for Shell Italia to fund the next phases of exploration of a potential new oil province in the extension of the Apennine thrust system offshore Sicily.
In the UK the Group is also a significant holder of licences in the south of England where it has a 10% interest in the production from the Horndean oil field and a 5% interest in the Avington development. In 2009 it is planning to drill an eastward extension of the Horndean oil field. Northern has a 50% interest in the venture.
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