28 Jan 2015 12:30
SACOIL HOLDINGS LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1993/000460/06)
JSE Share Code: SCL AIM Share Code: SAC
ISIN: ZAE000127460
("SacOil" or "the Company")
Completion of first phase development Operations - Lagia Oil field
SacOil Holdings Limited ("SacOil") through its subsidiary Mena International Petroleum Company Limited ("Mena") is pleased to announce the successful on-time completion of phase 1 of the field development operations at the Lagia oil field in Sinai, onshore Egypt.
Highlights
· Successful completion of hydraulic stimulation on all five existing wells.
· Phase 2 operations to commence by June 2015, installation of steam facilities and the drilling of up to 5 additional wells
As previously reported, the aim of phase 1 was to stimulate and re-complete the five existing production wells at the Lagia oil field in order to increase production.
Operations commenced on the 4th January 2015 and initial production indications are positive and the Company is confident that the targeted average production of 350 barrels of oil a day will be achievable from these five wells once they are in sustained production.
The oil produced from the Lagia field is trucked to the GPC (General Petroleum Company) facilities, which is owned by Egyptian General Petroleum Corporation, approximately 300 km from the Lagia field. Payments for delivered crude are paid directly to Mena.
Following the successful completion of phase 1 the wells remain on production and SacOil is preparing and planning a second phase of field development and production optimisation to start by June 2015. This second phase includes the installation of steam facilities for a thermal recovery process on the existing production wells and the drilling of up to five additional thermal wells at the Lagia oil field, with the intent of further enhancing production and the recovery of oil at the oil field.
Commenting on the completion of phase 1 development operations, Dr Thabo Kgogo, SacOil CEO, said, "This success of our development operation at the Lagia oil field is a key milestone for SacOil. It marks our transformation from an exploration and production company into realizing revenues from the sale of crude oil. The next phase of our operations at the Lagia oil field will focus on increasing production, as well as maintaining cost efficiencies and profitability during this oil price cycle."
"The lower oil price environment is something we are obviously following very closely. For the time being our net cash position remains positive and we remain committed to our strategic focus of portfolio rationalization, capital restructuring and overall cost savings."
JSE Sponsor
PSG Capital Proprietary Limited
28 January 2015
For further information please contact: | |
SacOil Holdings Limited Bradley Cerff |
+27 (0)11 575 7232 |
finnCap Limited (Nominated Adviser and Broker) Matthew Robinson / Christopher Raggett |
+44 (0) 20 7220 0500 |
FirstEnergy Capital (Financial Adviser and Joint Broker UK) Travis Inlow | +44 (0) 20 7448 0200
|
Instinctif Partners London (UK Investor Relations) David Simonson / Anca Spiridon | +44 (0)20 7457 2020 |
Instinctif Partners Johannesburg (SA Investor Relations) Nicholas Williams / Tshepo Mophiring | +27 (0)11 447 3030 |
Qualified Person Review
This release has been reviewed by Bradley Cerff, Executive Director, who is a member of the Society of Petroleum Engineers with over 15 years' experience in petroleum exploration and management. Bradley Cerff has consented to the inclusion of the technical information in this release in the form and context in which it appears.