PMO.L Regulatory News (PMO)

Premier Oil plc (Premier)

Block 7 Zama appraisal success

24 January 2019

Premier notes the press release by Talos Energy, the operator of Block 7 offshore Mexico, announcing the successful completion of the first part of the Zama appraisal programme.

Highlights

· 152 metres of net pay encountered above the oil water contact (OWC) as expected

· 73% Net-to-Gross ratio, higher than that at Zama-1 and ahead of pre-drill estimates

· Reservoir quality similar to that at Zama-1 as predicted

· Zama-2 well will now be side-tracked up-dip and flow tested as planned

The Zama-2 appraisal well was drilled 2.1 kilometres to the north of the Zama-1 discovery well in a down dip location with a key objective to confirm the OWC. The well encountered the top Zama reservoir at 3,279 metres (true vertical depth (TVD)) on prognosis and the OWC at 3,430 metres TVD, consistent with the flat-spot observed on seismic. A full wireline data acquisition programme was undertaken, including the collection of cores, pressures and fluid samples from the oil and water leg. 

The Zama-2 well penetrated 152 metres of net pay above the OWC in line with pre-drill estimates and encountered a higher Net-to-Gross ratio of 73% compared to 63% at Zama-1. Reservoir quality is similar to that at Zama-1 and in line with expectations.

Following completion of the data acquisition programme, the Zama-2 well was deepened to evaluate the high risk Marte exploration prospect. The Marte reservoir was encountered on prognosis and did not find hydrocarbons.

The Zama-2 well will now be side-tracked (Zama-2ST1) updip and will include a comprehensive coring programme as well as a drill stem test of the Zama reservoir. The programme is progressing ahead of schedule and is currently under budget. Further updates will be provided as key activities are completed.

Tony Durrant, Chief Executive, commented:

"This is an excellent start to the Block 7 Zama appraisal programme in Mexico. It enhances our interpretation of the large Zama discovery and increases our confidence in our resource estimates. We now look forward to the results of the drill stem test of the Zama-2 side track."