7 Nov 2017 07:00
7 November 2017
Eland Oil & Gas PLC
("Eland" or the "Company")
Opuama-7 and Opuama-8 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 its joint-venture subsidiary Elcrest Exploration and Production Nigeria Ltd ("Elcrest"), has successfully handed over the Opuama-7 well to the Opuama field production team and the well is currently flow testing into the production facilities and on to export.
Under the regulatory guidelines the Opuama production team are conducting a Maximum Efficient Test ("MER Test") incrementally testing the well at increasing choke sizes. The most recent test on a 40/64" choke, produced 6,700 bbls of oil per day on an extrapolated basis. The Opuama production team will continue the MER test up to a 48/64" choke, following which the Company will update the market further when full testing is complete, and production is stabilised. However, following the recent results it is expected that stabilised initial production from Opuama-7 will exceed the previous guidance of gross 5,900bopd.
Furthermore, following the successful completion of Opuama-7 side-track, the OES Teamwork Rig was mobilised to the Opuama-8 drill site and has since spudded the Opuama-8 infill well. Drilling is expected to be completed in December, with first oil from Opuama-8 of between 5,000 and 7,000bopd (gross) expected before the end of the year.
George Maxwell, CEO of Eland, commented:
"We are incredibly pleased to announce the successful completion of the Opuama-7 sidetrack and the strong results from flow testing the well. The early results for initial production look to be beyond our previous expectations and will lead to a significant increase in Elcrest's revenues and free cash flows.
Following this significant success, together with our partner NPDC, we now move our focus to the Opuama-8 well and an anticipated further increase in production of 5,000 to 7,000 bopd, which once successful will make the Company one of the largest oil producers on AIM."
For further information:
Eland Oil & Gas PLC (+44 (0)1224 737300)
www.elandoilandgas.com
George Maxwell, CEO
Ronald Bain, CFO
Finlay Thomson, IR
Canaccord Genuity Limited (+44 (0)20 7523 8000)
Henry Fitzgerald O'Connor / James Asensio
Panmure Gordon (UK) Limited (+44 (0)20 7886 2500)
Adam James / Atholl Tweedie
Tom Salvesen
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, Pieter van der Groen, a geologist and Eland's Chief Operating Officer, who has a geology degree from Auckland University, a Masters degree in Petroleum Geology from the University of Aberdeen and has over 25 years of relevant experience in the upstream oil and gas industry and who is a member of the Society of Petroleum Engineers and meets the criteria of qualified person 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 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 83.2 mmbbls, gross 2C contingent resources of 41.2 mmbbls and a best estimate of 254.5 mmbbls of gross unrisked 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.
The information contained within this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014. Upon the publication of this announcement, this inside information is now considered to be in the public domain.