Last checked at 12 Dec 2018 07:00
12 December 2018
Nostra Terra Oil and Gas Company plc
("Nostra Terra" or the "Company")
Mesquite - over 60 feet net pay in primary target formation
Nostra Terra (AIM:NTOG), the oil and gas exploration and production company with a portfolio of assets in the USA and Egypt, is pleased to report the results of the volumetric analysis conducted by Trey Resources, Inc ("Trey") as part of the Field Development Plan ("FDP") for the Mesquite Prospect ("Mesquite" or the "Prospect"). Following detailed analysis, Trey estimates Mesquite's primary target formation includes over 60 feet net pay thickness and 2.5 million barrels (MMstbl) oil-in-place across the current acreage.
On 25 October 2018 Nostra Terra announced that it had appointed Trey to create a Field Development Plan for the Prospect. Trey is an operator of Permian Basin assets and has specific experience in horizontal drilling across the region and further information on Trey can be found on www.treyresorces.net.
Mesquite is wholly owned by Nostra Terra and currently covers 1,384 net acres. Nostra Terra believes that Mesquite has the potential to host 8 horizontal wells, drilled along approximately one mile laterals, which could deliver initial production rates of 200-300 barrels of oil per day ("bopd"), in line with analogous regional wells.
NTOG's Board has received the initial results from Trey's volumetric work on the Mesquite Prospect. These confirm that the target formation within the leased area contains significant quantities of moveable hydrocarbons. In summary Trey estimates this includes:
· Average net pay thickness of over 60 feet across the target formation
· Estimated oil-in-place of 2.5 million barrels (MMstb)
Trey's analysis included a comprehensive review of over 600 logs of previously drilled vertical wells, both at Mesquite and in the immediate surrounding area. Such analysis has been a key component in identifying targets for successful horizontal drilling across the Permian Basin.
Trey's review included both high grading and detailed analysis of selected type wells, as well as analysis of regional geological trends and production data. Nostra Terra believes that this review is the first of its kind for the Mesquite Prospect and surrounding vicinity. Although the area has an established track record of historic production from vertical wells, Nostra Terra would be the first operator to drill a horizontal well here.
In the meantime, Trey has moved to the second phase of the FDP, which is to produce a report on the engineered economics for Mesquite. This will include a potential production type curve and well completion and cost estimates. Nostra Terra expects to receive the engineered economics report in the New Year.
Matt Lofgran, Chief Executive Officer of Nostra Terra, commented:
"We're very encouraged by the results of the volumetric work as a first step in our evaluation of these new leases. We look forward to commercializing these volumes in the near future.
The field has historically been a prolific oil producer from vertical wells. With the experience and data from the team we see this as an exciting opportunity to drill horizontal wells in order to see a substantial increase in production and cashflow."
Qualified Person Disclosure
John Stafford, a Director of Nostra Terra, with over 35 years relevant experience in the oil industry, has reviewed this announcement for the purposes of the AIM Note for Mining and 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.
This announcement contains inside information for the purposes of Article 7 of EU Regulation 596/2014.
For further information, visit www.ntog.co.uk or contact:
Nostra Terra Oil and Gas Company plc Matt Lofgran, CEO
| Tel: | +1 480 993 8933 |
Strand Hanson Limited (Nominated & Financial Adviser and Joint Broker) Rory Murphy / Ritchie Balmer / Jack Botros
| Tel: | +44 (0) 20 7409 3494 |
Smaller Company Capital Limited (Joint Broker) Rupert Williams / Jeremy Woodgate | Tel: | +44 (0) 20 3651 2910 |
About the Mesquite Prospect
The Mesquite Prospect is in West Texas and covers 1,384 net acres in the prolific Permian Basin. The Mesquite Prospect is proven to produce from multiple, stacked-pay reservoirs. Nostra Terra has identified 8 targets to drill horizontal wells across the Mesquite leases.
The target formations at the Mesquite Prospect are "tight", meaning the oil-bearing rock formations are of low permeability. As such, the target formations have characteristics that make them ideal targets for horizontal drilling and have delivered substantial oil production in other areas of the Permian Basin. Comparable regional horizontal drilling has delivered initial oil production rates of 200-300bopd.