20 Mar 2018 07:30
20 March 2018 RNS Reach
Sirius Petroleum Plc
("Sirius" or the "Company")
Ororo Field Update
Delivery of Compact Well Head Systems for Ororo-4 and Ororo-5
Sirius Petroleum (AIM:SRSP), the Nigeria focused oil and gas development and production company, is pleased to provide a further update on the Company's Ororo Field operations, confirming that two further well head systems are on route to Nigeria where they are planned for deployment on wells Ororo-4 and Ororo-5.
Sirius announced on 21 December 2017 the delivery of its first two sets of Cameron SOLIDrill modular compact well head systems in Nigeria for the Company to commence the drilling programme at: Ororo-2 and Ororo-3. Sirius plans to commence the drilling of its first well on the Ororo Field, the Ororo-2 in April 2018 which will be in a location close to the Ororo-1 well which was originally successfully drilled by Chevron in 1986.
All well head equipment and services for the Ororo Field are being supplied through Cameron, a Schlumberger Group Company. The Cameron SOLIDrill modular compact wellhead systems increase casing and tubing hanger landing reliability and help prevent debris from entering the wellhead. The hangers and packoffs are designed with angled shoulders to repel debris, such as dirt, metal shavings, and cement plugs.
Ends
Enquiries:
Sirius Petroleum +44 20 3740 7640
Bobo Kuti, Chief Executive
Mark Henderson, Chief Financial Officer
Cantor Fitzgerald Europe +44 20 7894 7000
David Porter/Nick Tulloch
Gable Communications +44 20 7193 7463
John Bick srsp@gablecommunications.com
Sirius Petroleum's Strategy and the Ororo Field
The Company's strategy is to target proven opportunities and maximize hydrocarbon production and recovery through the acquisition of discovered assets in Nigeria, with a particular focus on shallow water offshore areas and realise upside potential through appraisal activities. As part of the Company's strategy, Sirius has agreed innovative funding and operating partnerships with global industry leaders to work together on the Ororo asset and execute the drilling campaign to first oil.
Sirius's initial focus is on the Ororo field, which was originally operated by Chevron in 1986. Chevron drilled Ororo-1 and hydrocarbons were discovered in seven sandstone reservoirs (D1 to D5, F and G). Four of the reservoirs in the original Ororo-1 well were tested, two produced oil (D3 and G) at a combined rate of 2,800 bopd and two produced gas condensate (D4 and D5).
The Ororo field is located within OML 95 in the Niger Delta, offshore Nigeria, in the western part of the prolific Niger Delta petroleum system. It lies in shallow waters offshore Ondo State in water depths ranging between 23ft and 27ft. The field is adjacent to the Mina, West Isan, Ewan, Eko and Parabe fields, all of which are operated by Chevron.
Sirius has a 40% economic interest under a Financial & Technical Service Agreement and entered into a Joint Operating Agreement ('JOA') in August 2017 with its indigenous partners Owena Oil & Gas (100% state owned entity) and Guarantee Petroleum, who own 27% and 33% respectively.
According to the Ororo CPR produced by Rockflow Resources ("Rockflow") and set out in the Company's admission document, it is estimated that the Ororo-2 well will initially produce approximately 2,700bopd of light oil and 6mmcfd of gas.
Rockflow estimates that the Ororo asset has a Mid Case Net Present Value to Sirius (NPV10) of $96m, based on a $65 per barrel flat real oil price for the life of the field. According to the Ororo CPR, the mid-case gross recoverable 2C contingent resources are 24 mmboe.
Ororo economic evaluations produced by Rockflow subsequent to issue of the CPR:
Oil Price | Gross Project NPV10 US$ MM Low
| Gross Project NPV10 US$ MM Mid | Gross Project NPV10 US$ MM High | Sirius Project NPV10 US$ MM Low | Sirius Project NPV10 US$ MM Med | Sirius Project NPV10 US$ MM High |
65 | 126.5 | 279.4 | 695.2 | 32.9 | 96.1 | 274.3 |
70 | 144.6 | 309.1 | 756.9 | 40.9 | 108.9 | 300.9 |
Gas BOE conversion factor: 1 barrel of oil equivalent = 5800 cu ft gas
*Under SPE Guidelines, the hydrocarbons are classified as Contingent Resources and will convert into Reserves upon finalisation of approvals and agreements with contractors. The valuation methodology used by Rockflow provides for the commercial producible resources to be defined rather than the technically producible oil. Under the present oil price scenario this results in a modest change for the tail end volumes in relation to the volumetrics reported on 2nd June 2017
Glossary | |
Bopd: | barrels of oil per day.
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Mmboe: | million barrels of oil equivalent.
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Contingent resource: | Resources estimated at a certain date as potentially recoverable from known accumulations, but which are not currently considered commercially recoverable.
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2C: | Proved and Probable Contingent Resources.
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Packoff: | A flexible housing used to seal an irregular surface such as a wireline.
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Tubing Hanger: | A device attached to the topmost tubing joint in the wellhead to support the tubing string. The tubing hanger typically is located in the tubing head, with both components incorporating a sealing system to ensure that the tubing conduit and annulus are hydraulically isolated. |