28 Apr 2015 07:00
Rose Petroleum plc ("Rose" or the "Company")
Mancos shale operations update
Rose Petroleum plc, the AIM-listed (AIM: ROSE) natural resources company, is pleased to provide an operational update on activities within its highly prospective Uinta Basin acreage in Utah, in which it has a 75% working interest, and where the Company's primary target is the Mancos Shale.
Highlights
· Core results to date from the Mancos Shale formation reconfirm the area's prospectivity and have provided the Company with the positive technical data it hoped for - full core analysis results on track for Q2 2015
· Positive steps taken towards gaining permits for six new Mancos wells with a focus on submitting the 'final authority to drill plan' to the Bureau of Land Management ("BLM") in late May 2015
o HRL Compliance Solutions and Uintah Engineering have completed the internal location site evaluation, with no red flags, in consideration of the Environmental Assessment ("EA") requirements and are in various stages of finishing reports to submit to the BLM
o Subject to timely provision of permits, the Company anticipates commencing drilling the first of these new wells in late 2015
· First horizontal well to be drilled at one of the six new well locations. Core results to date, combined with the more robust well control in the Cisco Dome region, suggest that this area has the potential to be the optimal initial prospect for drilling.
Matthew Idiens, Group CEO, commented:
"The results to date from the Mancos Shale core analysis are in line with our expectations and re-emphasise the prospectivity of this exciting opportunity. Based on the data gained by the analytical results, we are confident in proceeding with our exploitation of this formation. We plan to permit a six well programme and, having now selected our top targets, we are eager to move the process ahead and plan to start drilling the first of these in late 2015.
"Our detailed geological and engineering assessment suggests that targeting the Mancos in the Cisco Dome field will deliver the best results going forward for our shareholders and, given that we would need to re-permit a horizontal well at the State 1-34 location, we plan to target the new location with better well control and excellent surface infrastructure with the gathering system and processing plant nearby.
Ty Watson and the team are pulling together to deliver on the stated operational milestones."
Mancos shale core analysis
Results to date from ongoing analysis confirm the technical data the Directors anticipated and has provided a useful insight into the geological nature present within the Company's licence area.
Six well permitting programme
Rose's experienced team has picked its locations for the first six Mancos Shale well locations for permitting.
To date, HRL Compliance Solutions and Uintah Engineering have evaluated each location site in consideration of environmental surveying requirements. All of this work is done as a precursor and preliminary approval for permit to drill that will then start the actual EA and BLM permitting approval process. The final authority to drill plans are anticipated to be submitted in May 2015 to the BLM.
State 1-34 Well
The Company was hopeful that limited early stage cash flow would be achievable from the conventional target located beneath the Mancos Shale. However, as announced on 31 March 2015, following completion on this target, this was deemed unviable. Analysis of the electrical logs showed that, whilst the conventional zone was present, it was unviable as a result of the wellbore intersecting a close existing vertical fracture filled with water which in turn exposed the conventional zones to water making them uncommercial.
Having completed the well in the conventional target and based on the orientation data from the core analysis, the Company can no longer use the 1-34 vertical well for the horizontal leg. In order to drill the horizontal, the Company would be required to permit a whole new location stepping away and drilling laterally towards the 1-34 existing well location. However with the well data now available for the Cisco Dome field, the Company believes that its proposed well location in the Cisco Dome area has much stronger success potential with additional cost savings from the existing surface infrastructure in place at the location, being local to the company's gathering system and processing plant.
**ENDS**
For further information please visit www.rosepetroleum.com or contact:
Matthew Idiens (CEO) | Rose Petroleum plc | Tel: +44 (0) 20 7236 1177 |
Jeremy Porter | Allenby Capital | Tel: +44 (0) 20 3328 5656 |
Alex Price | Allenby Capital | Tel: +44 (0) 20 3328 5656 |
Elisabeth Cowell | St Brides Partners Ltd | Tel: +44 (0) 20 7236 1177 |
Lottie Brocklehurst | St Brides Partners Ltd | Tel: +44 (0) 20 7236 1177 |
About Rose Petroleum
Rose Petroleum plc (AIM Ticker: ROSE) is focusing on developing its oil & gas portfolio, while seeking to create value from its existing mining, milling and porphyry copper exploration portfolio.
In March 2014, Rose signed a farm-in agreement under which its newly formed subsidiary, Rose Petroleum (Utah) LLC, can earn 75% of certain oil, gas and hydrocarbon leases covering approximately 230,000 acres in Grand and Emery Counties, Utah, USA, within the Paradox and Uinta basins.
In May 2014, Rose published the results of its reserve report prepared by Ryder Scott Company on the Mancos and Paradox Oil & Gas Projects. Un-risked Prospective (Recoverable) Hydrocarbon Resources on a Mean Case basis for the collective total Mancos Shale and Paradox Formation combined was 1,825.07 MMBO (million barrels of oil) and 6,447.87 BCFG (billion cubic feet of gas).
In June 2014, the Company successfully raised £6.5m by way of an oversubscribed conditional placing and subscription to develop the Mancos and Paradox assets in Eastern Utah, and the completion of a further £3.5 million fundraise was announced on 5 December 2014.
In October 2014, Rose acquired 100% of the assets of a privately owned SEP - Cisco Dome, LLC and various other associated entities for US$1.5 million in cash. The acquired assets included 11,000.02 gross / 8,250.02 net acres of highly prospective Mancos acreage, a gas compression station and gas processing plant as well as 17 producing wells and 35 shut-in wells.
In December 2014, Rose spudded its first well in the Uinta Basin taking core samples from the Mancos Shale. Whole core was taken within the Mancos Shale and is being analysed for optimisation of the well stimulation programme for future horizontal wells in the Mancos Shale.
Rose intends to build on these projects to establish a balanced international asset portfolio. For further information please consult the Company's website: www.rosepetroleum.com