10 Jan 2019 07:00
10 January 2019
Eland Oil & Gas PLC
("Eland" or the "Company")
Gbetiokun Operations Update
Eland Oil & Gas PLC (AIM: ELA), an oil & gas production and development company operating in West Africa with an initial focus on Nigeria, is delighted to announce that through its joint-venture subsidiary, Elcrest Exploration and Production Nigeria Ltd ("Elcrest"), it has completed drilling phase of the Gbetiokun-3 appraisal/development well.
The OES Teamwork Rig has successfully completed drilling the Gbetiokun-3 well as part of the initial phase of the field development. The well encountered oil-bearing reservoirs across multiple horizons and will be completed as a dual producer on the D9000 and E4000 reservoirs, which have total net pay thicknesses of approximately 46 feet and 44 feet true vertical depth ("TVD") respectively. The secondary target reservoir, E7000, was encountered slightly deeper than expected and consequently the decision has been taken to complete this well on the E4000 reservoir. The E7000 is currently being reassessed with a view to being targeted by future wells. Downhole samples collected from the D5000 established that the shallow reservoir oil is mobile and pressure volume temperature ("PVT") analysis will be performed on the sample to confirm the D5000 can be developed commercially.
Completion of the Gbetiokun-3 well is expected in January. Production testing of the Gbetiokun-1 and Gbetiokun-3 wells will be conducted using an early production system ("EPS") with initial estimated gross combined production at approximately 15,000 barrels of oil per day ("bopd") (6,750 bopd net to Elcrest). Start-up of the EPS is expected to be Q1 2019.
George Maxwell, CEO of Eland, commented:
"Further to our announcement on 24 December 2018, the Company has successfully completed the drilling of the Gbetiokun-3 well. Gbetiokun has the potential to deliver a significant increase in oil production from OML 40 and we look forward to updating shareholders on flow testing later this quarter."
For further information:
Eland Oil & Gas PLC (+44 (0)1224 737300)
www.elandoilandgas.com
George Maxwell, CEO
Ronald Bain, CFO
Finlay Thomson, IR
Peel Hunt LLP, Nominated Adviser & Joint Broker (+44 (0)20 7418 8900)
Richard Crichton
David McKeown
Stifel Nicolaus Europe Limited, Joint Broker (+44 (0)20 7710 7600)
Callum Stewart
Nicholas Rhodes
Ashton Clanfield
Camarco (+44 (0) 203 757 4980)
Billy Clegg
Georgia Edmonds
Tom Huddart
In accordance with the guidelines of the AIM Market of the London Stock Exchange, Yannis Korakakis, MSc of Leoben University, with 32 years of experience in the oil and gas sector, is a Petroleum Engineer and member of the Society of Petroleum Engineers who meets the criteria of qualified persons under the AIM guidance note for mining and oil and gas companies, has reviewed and approved the technical information contained in this announcement.
Notes to editors:
Eland Oil & Gas is an AIM-listed independent oil and gas company focused on production and development in West Africa, particularly the highly prolific Niger Delta region of Nigeria.
Through its joint venture company Elcrest, Eland's core asset is a 45% interest in OML 40 which is in the Northwest Niger Delta approximately 75km northwest of Warri and has an area of 498km².
In addition, the Company has a 40% interest in the Ubima Field, onshore Niger Delta, in the northern part of Rivers State.
The OML 40 licence holds gross 2P reserves of 83.4 mmbbls, gross 2C contingent resources of 40.4 mmbbls and a best estimate of 254.5 mmbbls of gross un-risked prospective resources*
The Ubima field holds gross 2P reserves of 2.4 mmbbls of oil and gross 2C resource estimates of 31.1 mmbbl**
Net production figures relate to Elcrest Exploration and Production Nigeria Ltd ("Elcrest"), Eland's joint venture company. Production rates, when oil is exported via Forcados, are as measured at the Opuama PD meter, are subject to reconciliation and will differ from sales volumes.
*Netherland, Sewell & Associates Inc CPR report 31 December 2017
**AGR TRACS April 2016
The information contained within this announcement is considered to be inside information prior to its release, as defined in Article 7 of the Market Abuse Regulation No. 596/2014, and is disclosed in accordance with the Company's obligations under Article 17 of those Regulations