21 Jul 2015 07:00
EGDON RESOURCES PLC
21 July 2015
("Egdon" or "the Company")
Wressle-1 Extended Well Test Update - Results of Penistone Flags Zone 3A Test
Egdon Resources plc (AIM:EDR) is pleased to announce encouraging results from the pumped test carried out over the Penistone Flags Zone 3A as part of the Extended Well Test ("EWT") at the Wressle-1 oil and gas discovery in licence PEDL180, located to the east of Scunthorpe, where Egdon operates with a 25% interest.
During earlier initial testing, the Wressle-1 well produced oil and gas from three discrete reservoir intervals, the Ashover Grit, the Wingfield Flags, and the Penistone Flags as previously reported. At the end of those test operations, a completion was installed in the well to cater for a subsequent pumped EWT over the oil productive zones in the Ashover Grit (Zone 1) and the Penistone Flags (Zone 3A).
Due to problems experienced with the downhole testing equipment, the pumped flow test of the Ashover Grit oil reservoir could not be undertaken first as originally planned, therefore test operations were switched to focus initially on the shallower Penistone Flags.
The Penistone Flags interval was pumped for a period of time and achieved average rates over a three day period of 131 barrels of oil per day ("bopd") and 222,000 cubic feet of gas per day, together totalling 168 barrels of oil equivalent per day ("boepd") with an average producing gas oil ratio ("GOR") of approximately 1,700 cubic feet of gas per barrel of oil ("scf/stb").
Due to increasing gas rates the pump was then stopped and the well allowed to naturally flow to surface on a series of decreasing choke sizes from 12/64" down to 8/64" (being the smallest available). Average rates over a two day period on the 8/64" choke were 105 bopd with 465,000 cubic feet of gas per day, together totalling 182 boepd with an average producing GOR of approximately 4,450 scf/stb.
During the course of this flow testing no associated formation water has been produced.
The gas production rate has increased to the point where it is approaching the limits allowed under the environmental permit and as such production from the interval has now been halted. The well is now being killed ready for the next operation to be conducted, an injection test over the Penistone Flags zone 3A interval, to provide further reservoir data.
On conclusion of this injection test, attention will return to resolving the operational issues and undertaking pumped oil production testing over the Ashover Grit interval.
Commenting on the latest flow test result, Mark Abbott, Managing Director of Egdon Resources said:
"I am pleased to report the continuing encouraging results from the Wressle-1 test programme. The hydrocarbon production rate of over 180 barrels of oil equivalent per day attained from the Penistone Flags oil zone has exceeded pre-test expectations. The production performance together with the planned injection test will provide valuable reservoir engineering data that will be used to plan for a commercial development of the Penistone Flags.
We now look forward to commencing operations on the EWT programme for the Ashover Grit and will provide another update in due course."
For further information please contact:
Egdon Resources plc
Mark Abbott, Jerry Field 01256 702 292
Buchanan
Richard Darby, Anna Michniewicz 020 7466 5000
Nominated Adviser and Broker - Cantor Fitzgerald Europe
David Porter, Sarah Wharry (Corporate Finance) 020 7894 7000
Richard Redmayne (Corporate Broking)
Joint Broker - VSA Capital Limited
Andrew Monk (Corporate Broking) 020 3005 5000
Andrew Raca (Corporate Finance)
Notes to Editors:
The Wressle Oil Discovery -The Wressle Prospect was defined on proprietary 3D seismic data, which was acquired by Egdon in February 2012. The structure is located on trend with the producing Crosby Warren oil field and the Broughton-B1 oil discovery, both to the immediate northwest, and the Brigg-1 oil discovery to the immediate southeast. All contain oil in various different sandstone reservoirs within the Upper Carboniferous succession. The pre-drill gross mean Prospective Resources at Wressle, as calculated by Egdon, were estimated to be 2.1 million barrels of oil. This will be updated following the results of the current test operations.
The Wressle-1 well reached a total depth (TD) of 2240 metres measured depth (MD) (1814 metres true vertical depth below OS datum (TVDSS)) on 23 August 2014. Elevated mud gas readings were observed over large parts of the interval from the top of the Penistone Flags reservoir target (1831.5 metres MD) to TD. The interests in the Wressle-1 well are:
Egdon Resources U.K. Limited 25.00% (Operator)
Celtique Energie Petroleum Limited 33.33%
Europa Oil & Gas Limited 33.34%
Union Jack Oil plc 8.33%
The well was logged using measurement whilst drilling (MWD) logging tools run on the drill string. Petrophysical evaluation of the log data indicated the presence of potential hydrocarbon pay in three main intervals;
· Penistone Flags - up to 19.8 metres measured thickness (15.9 metres vertical thickness)
· Wingfield Flags - up to 5.64 metres measured thickness (5.1 metres vertical thickness)
· Ashover Grit - up to 6.1 metres measured thickness (5.8 metres vertical thickness)
On 9 February 2015, shareholders were updated on the successful Ashover Grit Flow Test, which recorded flow rates of 80 barrels of oil per day and 47 thousand cubic feet of gas per day during a 16 hour main flow period. No appreciable volumes of water were observed. The oil is of good quality with a gravity of 39-40° API.
On 19 February 2015, shareholders were updated on the successful Wingfield Flags Flow Test, which recorded flow rates of up to 182 barrels of oil per day of good quality 39-40 API oil on free flow, along with up to 456 thousand cubic feet of gas per day.
On 27 February 2015, shareholders were updated on the initial successful Penistone Flags test, which produced gas at facilities-restricted flowrates of up to 1.7 million cubic feet of gas per day with associated oil of up to 12 barrels of oil per day and no free water.
On 27 March 2015, shareholders were updated on the second successful Penistone Flags test. Zone 3a in the Penistone Flags was perforated over a 7.5 metre interval and produced good quality oil with a gravity of 33o API. A total of 98.5 barrels of oil were recovered during the test (of which flow induced by swabbing operations produced 34.3 barrels of oil). This equates to a rate of approximately 77 barrels of oil per day (bopd).
During the current EWT the Zone 3A perforations were produced for a total of 254hrs over a 13 day period from the 5th to 17th Jul'15. Zone 3A was initially produced by sucker rod pump and then allowed to free flow to surface after the wellbore & perforations had fully cleaned-up. Over the full 13 day period the following separator cumulative volumes were produced:- 1,127 bbl of oil, 147 bbl of kill brine and 2,790 Mscf of gas.
Operations at the Wressle site will not involve the process of high volume hydraulic 'fracturing (fracking') for shale gas.
Egdon Resources plc (LSE: EDR) is an established UK-based exploration and production company primarily focused on onshore exploration and production in the hydrocarbon-producing basins of the UK and France.
Egdon currently holds interests in thirty four licences in the UK and France and has an active programme of exploration, appraisal and development within its balanced portfolio of oil and gas assets. Egdon is an approved operator in both the UK and France.
Egdon was formed in 1997 and listed on AIM in December 2004.
In accordance with the AIM Rules - Note for Mining and Oil and Gas Companies, the information contained in this announcement has been reviewed and signed off by the Managing Director of Egdon Resources plc Mark Abbott, a Geoscientist with over 26 years' experience.
Evaluation of potential recoverable hydrocarbons has been assessed in accordance with 2007 Petroleum Resources Management System prepared by the Oil and Gas Reserves Committee of the Society of Petroleum Engineers (SPE) and reviewed and jointly sponsored by the World Petroleum Council (WPC), the American Association of Petroleum Geologists (AAPG) and the Society of Petroleum Evaluation Engineers (SPEE).