Last checked at 7 Jun 2022 13:07
07 June 2022
Nostra Terra Oil and Gas Company Plc
("Nostra Terra" or "the Company")
Grant East #1 Completion Results
Nostra Terra (AIM: NTOG), the international oil & gas exploration and production company with a portfolio of production and development assets in Texas, USA, announces that the Grant East #1 well, in the Permian Basin, West Texas, has been temporarily abandoned ("TA").
Following the drilling announcement on the 9th of May, the well was completed in multiple horizons. The well was then fractured stimulated in 3 stages and tested. On test the well flowed high rates of water with a low oil cut. Several attempts were made to isolate the deeper water producing horizons from the shallower oil zones, but they were unsuccessful. The well has been suspended until a decision is made on what to do with the existing wellbore. The Grant East #1 could be used as a future injector or re-entered and used as a producer based on results of a future offset well. Presently there is not sufficient treating capacity within the field to handle the associated water volumes, however, as the development progresses and treating capacity is expanded it may be possible to efficiently produce the Grant East #1 as it is currently completed.
The Grant East 1 is in the centre of a proven producing field and the well encountered 24 feet of gross reservoir section in the Upper Clear Fork and 108 feet of gross reservoir section in the Lower Clear Fork, which compares favourably with the NTOG operated wells on an adjoining lease (the Grant #5 and #6 wells). Early analysis of the producing results and the produced fluids indicates that the fracture stimulation propagated out of zone and intersected a deeper horizon that is used as a water disposal interval on an offset lease. This deeper zone is over pressured and of good reservoir quality, which caused the well to flow at high rates of injected water with a low oil cut. Additional technical work needs to be completed to confirm this analysis but early indications, and a look back at pumping rates and pressures while stimulating, provide support for this conclusion.
Technical work is on-going and will be completed before the next location on the Grant Lease is drilled later this year. Results of this analysis will be implemented in the completion procedures of subsequent Grant East wells to avoid intersecting this deeper horizon in future.
Matt Lofgran, Nostra Terra's Chief Executive Officer, said:
"The results of the Grant East 1 are unfortunate, but the information obtained is very important. There are still 15 viable drilling locations within the Grant East Lease and the information obtained from the Grant East 1 well will be used to improve and optimise future completions. I am looking forward to drilling the next location using this new information.
Nostra Terra has made significant progress this year increasing production and cashflow. The Company is in a very strong position at this point. While the result on the Grant East well isn't what we wanted, we remain optimistic about further drilling in this proven area, funded from existing resources."
This announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) No. 596/2014, as it forms part of UK Domestic Law by virtue of the European Union (Withdrawal) Act 2018. Upon the publication of this announcement, this inside information is now considered to be in the public domain.
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Competent Person Disclosure
John Stafford, a Director at Nostra Terra with over 35 years' relevant experience in the oil industry, has reviewed this announcement for the purposes of the current Guidance Note for Mining, Oil and Gas Companies issued by the London Stock Exchange in June 2009. Mr. Stafford is a Fellow of the Geological Society and a member of the Petroleum Exploration Society of Great Britain.