6 Sep 2012 07:00
Immediate Release (embargoed until 7 am)
6 September 2012
Leni Gas & Oil PLC
("LGO" or the "Company")
Independent Reserves Report, Goudron Field, Trinidad
LGO today announces the publication of a Competent Persons Report ("CPR") on the Goudron Field in south-eastern Trinidad, where the Company owns the exclusive rights to acquire the existing Incremental Production Services Contract ("IPSC").
In May 2012, the Company commissioned Challenge Energy Limited ("Challenge") to prepare a CPR for the Goudron Field. Previous resources data available to LGO was the result of in-house work conducted by Sorgenia Trinidad and Tobago Holdings Limited ("Sorgenia") from whom LGO acquired the rights.
LGO is in the final stage of acquiring a 100% working interest in the IPSC granted by the Trinidad and Tobago Petroleum Company ("Petrotrin") which will give LGO rights to produce oil from the Goudron Block which covers horizons down to 5,000 feet TVD subsea. The IPSC was effective from 18 November 2009 and has an initial term of 10 years. Once acquired, the field will be operated by Goudron E&P Limited a wholly owned subsidiary of LGO.
Challenge has reported proven and probable (2P) reserves of 7.2 million barrels (mmbbls) and proven, probable and possible reserves (3P) of 30.4 mmbbls. All these reserves are associated with natural depletion alone and result from an LGO program of work-overs, new wells and well side-tracks to be carried out over the economic life of the field. Previously published estimates from Sorgenia included 2P reserves of 8.0 mmbbls and 3P reserves of 21.8 mmbbls. The increase in 3P reserves by 8.6 mmbbls (39%) derives largely from the additional confidence in the economics of continued infill drilling. The table set out below divides these reserves between those recovered under the current IPSC term and those recovered from a subsequent extension.
No secondary recovery, such as water-flooding, has been assumed in these reserves estimates, although analogous fields in Trinidad have had successful water-flood projects. Overall recovery without water-flooding is estimated to be 10% of the oil-in-place which has been computed to be up to 350 mmbbls in the 3P case. Challenge recognizes up to a further 63.2 mmbbls of contingent resources associated with future water injection. If such a project was undertaken it is believed that the overall recovery factor would rise to about 28%. These contingent resources are summarized below.
Assignment of the Goudron IPSC to the LGO wholly owned subsidiary Goudron E&P Limited has been approved by the Trinidad and Tobago Ministry of Energy and Petrotrin and the formal documentation is expected to be completed within the next month.
Following the success of the earlier work-over campaign undertaken in May and June this year the Company has additionally agreed with the current owner, Cameron Oil and Gas Ltd, to carry out a further five well work-over program in October. Details of that program will be the subject of a later announcement.
Neil Ritson, LGO's Chief Executive, commented:
"The availability of an independent CPR which confirms the 2P estimates available at the time of purchase and provides a 39% upgrade of the 3P reserves is excellent news. This report also contains a review of the contingent resources associated with a possible water-flood and reveals that a very significant prize of up to over 60 mmbbls is available. We anticipate completing the acquisition of the IPSC within the next month and we will also be mobilizing a rig to the field again later this month."
Reserves Data:
mmbbls at 1/07/2012 | 1P | 2P | 3P |
Reserves to November 2019 | 0.7 | 3.5 | 9.3 |
Reserves produced after November 2019 | 0 | 3.7 | 21.1 |
Total Reserves | 0.7 | 7.2 | 30.4 |
Source: Challenge Energy Limited
Contingent Resources Data:
mmbbls at 1/07/2012 | 1C | 2C | 3C |
Total Goudron Sand | 1.9 | 7.0 | 18.5 |
Total Cruse Sand | 4.3 | 8.9 | 44.7 |
Total Contingent Resources | 6.2 | 15.9 | 63.2 |
Source: Challenge Energy Limited
Competent Person's Statement:
The information contained in this announcement has been reviewed and approved by Neil Ritson, Chief Executive Officer and Director for Leni Gas & Oil Plc who has over 35 years of relevant experience in the oil industry. Mr. Ritson is a member of the Society of Petroleum Engineers, an Active Member of the American Association of Petroleum Geologists and is a Fellow of the Geological Society of London.
The estimates provide in this statement are based on the Petroleum Resources Management System ("PRMS") published by the Society of Petroleum Engineers ("SPE") and are reported consistent with the SPE's 2011 guidelines. A copy of the PRMS is available at http://www.spe.org/industry/reserves.php. All definitions used in this announcement have the meaning given to them in the PRMS.
Glossary
Contingent Resources
| those quantities of petroleum estimated, as of a given date, to be potentially recoverable from known accumulations, but the applied project(s) are not yet considered mature enough for commercial development due to one or more contingencies. Contingent Resources may include, for example, projects for which there are currently no viable markets, or where commercial recovery is dependent on technology under development, or where evaluation of the accumulation is insufficient to clearly assess commerciality |
mmbbls | million barrels of oil |
oil-in-place | the volume of oil estimated to have been initially in place |
Possible Reserves
| those additional reserves which analysis of geoscience and engineering data suggest are less likely to be recoverable than Probable Reserves. The total quantities ultimately recovered from the project have a low probability to exceed the sum of Proved plus Probable plus Possible (3P) Reserves, which is equivalent to the high estimate scenario |
Probable Reserves
| those additional reserves which analysis of geoscience and engineering data indicate are less likely to be recovered than Proved Reserves but more certain to be recovered than Possible Reserves. It is equally likely that actual remaining quantities recovered will be greater than or less than the sum of the estimated Proved plus Probable Reserves |
Proven Reserves | those quantities of petroleum, which, by analysis of geoscience and engineering data, can be estimated with reasonable certainty to be commercially recoverable, from a given date forward, from known reservoirs and under defined economic conditions, operating methods, and government regulations |
TVD | true vertical depth |
Enquiries:
Leni Gas & Oil plc
David Lenigas Neil Ritson | +44 (0)20 7440 0645
|
Beaumont Cornish Limited
Nomad and Joint Broker Rosalind Hill Abrahams Roland Cornish | +44(0) 20 7628 3396 |
Old Park Lane Capital Plc
Joint Broker Michael Parnes Luca Tenuta | +44(0) 20 7493 8188 |
Shore Capital
Joint Broker
Pascal Keane +44 (0) 20 7408 4090
Jerry Keen (Corporate Broking)
Pelham Bell Pottinger
Financial PR Mark Antelme | +44 (0) 20 7861 3232 |
Henry Lerwill |