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Q4 2023 results from Williston Basin portfolio

29 Feb 2024 07:00

RNS Number : 8672E
Zephyr Energy PLC
29 February 2024
 

Prior to publication, the information contained within this announcement was deemed by the Company to constitute inside information as stipulated under the UK Market Abuse Regulation. With the publication of this announcement, this information is now considered to be in the public domain.

29 February 2024

Zephyr Energy plc

("Zephyr" or the "Company")

 

Fourth Quarter 2023 production results from the Williston Basin portfolio

Zephyr Energy plc (AIM: ZPHR) (OTCQB: ZPHRF), the Rocky Mountain oil and gas company focused on responsible resource development from carbon-neutral operations, is pleased to provide initial fourth quarter 2023 ("Q4") results related to hydrocarbon production from its non-operated asset portfolio in the Williston Basin, North Dakota, U.S (the "Williston project").

· Q4 production averaged 1,053 barrels of oil equivalent per day ("boepd") compared to production in the third quarter of 2023 ("Q3") of 983 boepd, representing an increase of 7% quarter on the quarter.

o Peak daily production rates of 1,440 boepd were achieved in late November 2023 with the commencement of the initial production from the six wells operated by Slawson Exploration Company (the "Slawson wells").

o Production from the Slawson wells was temporarily curtailed in mid-December 2023 due to adverse weather conditions and infrastructure constraints. Zephyr has been informed by the operator that production from the Slawson wells resumed in late January 2024.

o Q4 production rates from the remainder of the portfolio were as expected.

 

· 2023 full-year production was only marginally under forecast (1,040 boepd actual vs 1,150 boepd forecast) despite the above-mentioned factors impacting the Slawson wells. All other wells performed in line with management expectations during the year. 

 

· 2023 full-year revenues from the portfolio are estimated to be, subject to audit, circa US$26.3m of which it is expected more than 90% is made up of oil sales.

o Q4 revenues are estimated to be, subject to audit, circa US$6.9m compared to Q3 revenues of US$6.0m.

 

· At 31 December 2023, 225 wells in Zephyr's portfolio were available for production (versus 220 wells at the end of Q3).

 

· Net working interests across the Zephyr portfolio now average 8% per well (equivalent to 15.1 net wells).

 

· During February 2024, ten wells in which Zephyr holds working interests and which are operated by Continental Resources (Harms Federal and Quale Federal) were placed in production. Early production data shows these wells performing ahead of management expectation, adding initial production rates, net to Zephyr, of circa 75 boepd.

 

· The Company has hedged 27,000 barrels of oil over the first quarter of 2024 at a weighted-average price of US$82.20 per barrel. The Company will continue to evaluate its commodity price risk management strategy on a regular basis.

 

Colin Harrington, Chief Executive of Zephyr, said: "Our non-operated assets continue to deliver strong and robust cash flows, allowing us to proceed with the next phase of our Paradox project in the near-term."

"The initial indications of the performance of the Slawson wells continue to exceed our estimates and the wells have the potential to materially increase our 2024 cash flows. Very strong initial performance from the Harms Federal and Quale Federal wells is also highly encouraging."

"We continue to make good progress ahead of the commencement of drilling on the Paradox project and will be providing a further update on this in the coming days."

Note

Q4 production volumes are based on a combination of state reported production volumes and field estimate production reports supplied by certain operators. Both production data sets are two phase reports (oil and well head gas) as opposed to sales volume reporting which is three phase and consists of oil, processed sales gas and NGL volumes. While Zephyr previously reported three phase sales volumes, going forward the Company will report two phase production volumes on a quarterly basis and three phase sales volumes on an annual basis. This change has been necessitated by the timing of the receipt of sales volume data from certain operators.

Contacts

Zephyr Energy plc

Colin Harrington (CEO)

Chris Eadie (CFO)

 

 Tel: +44 (0)20 7225 4590

Allenby Capital Limited - AIM Nominated Adviser

Jeremy Porter / Vivek Bhardwaj

 

 Tel: +44 (0)20 3328 5656

 

Turner Pope Investments - Joint-Broker

James Pope / Andy Thacker 

 

Panmure Gordon (UK) Limited - Joint-Broker

Hugh Rich / James Sinclair-Ford

 

Celicourt Communications - PR

Mark Antelme / Felicity Winkles / Ali AlQahtani

 Tel: +44 (0)20 3657 0050

 

 

Tel: +44 (0) 20 7886 2500

 

 

 

Tel: +44 (0) 20 8434 2643

 

Qualified Person

 Dr Gregor Maxwell, BSc Hons. Geology and Petroleum Geology, PhD, Technical Adviser to the Board of Zephyr Energy plc, who meets the criteria of a qualified person under the AIM Note for Mining and Oil & Gas Companies - June 2009, has reviewed and approved the technical information contained within this announcement.

Notes to Editors

Zephyr Energy plc (AIM: ZPHR) (OTCQB: ZPHRF) is a technology-led oil and gas company focused on responsible resource development from carbon-neutral operations in the Rocky Mountain region of the United States. The Company's mission is rooted in two core values: to be responsible stewards of its investors' capital, and to be responsible stewards of the environment in which it works.

Zephyr's flagship asset is an operated 46,000-acre leaseholding located in the Paradox Basin, Utah, 25,000 acres of which has been assessed to hold, net to Zephyr, 2P reserves of 2.6 million barrels of oil equivalent ("mmboe"), 2C resources of 34 mmboe and 2U resources 270 mmboe.

In addition to its operated assets, the Company owns working interests in a broad portfolio of non-operated producing wells across the Williston Basin in North Dakota and Montana. Cash flow from the Williston production will be used to fund the planned Paradox Basin development. In addition, the Board will consider further opportunistic value-accretive acquisitions. 

 

 

 

 

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END
 
 
UPDSEEFUAELSEIE
Date   Source Headline
23rd Jul 20247:00 amRNSInitial results from State 36-2R production test
9th Jul 20247:00 amRNSOperations Update
27th Jun 20247:00 amRNSFinal Results
26th Jun 20247:00 amRNSOperations Update
14th Jun 20247:00 amRNSState 36-2R well production test
6th Jun 20247:00 amRNSState 36-2R well update
3rd Jun 20247:00 amRNSState 36-2R well drilling update
31st May 20245:00 pmRNSTotal Voting Rights
31st May 20247:00 amRNSQ1 2024 results from the Williston Basin portfolio
29th May 20247:01 amRNSGrant funding from U.S. DOE & drilling update
14th May 20247:00 amRNSOperations update, warrant exercise and TVR change
3rd May 20247:00 amRNSHolding(s) in Company
3rd May 20247:00 amRNSDebt for equity exchange & State 36-2R well update
25th Apr 20247:00 amRNSStart of well drilling operations
17th Apr 20247:00 amRNSState 36-2R well drilling operations update
10th Apr 20247:00 amRNSGrant of share options and issue of warrants
28th Mar 20247:00 amRNSAdditions to senior management team
27th Mar 20241:02 pmRNSSalt Wash helium project update - replacement
27th Mar 20247:00 amRNSSalt Wash helium project update
22nd Mar 20247:00 amRNSCommencement of Initial Drilling Operations
15th Mar 20247:00 amRNSAward of rig contract to Helmerich & Payne
11th Mar 20247:00 amRNSParadox project update
29th Feb 20247:00 amRNSQ4 2023 results from Williston Basin portfolio
14th Feb 20247:00 amRNSState 36-2R Drilling Permit Sundry Notice Approval
8th Feb 20247:00 amRNSOperations update
15th Dec 20237:00 amRNSOperational update
15th Nov 20237:00 amRNSQ3 2023 results from Williston Basin portfolio
1st Nov 20237:00 amRNSWilliston Basin Update
25th Oct 20237:00 amRNSInvestor Webinar Registration
18th Oct 202312:38 pmRNSInvestor Webinar
18th Oct 20237:00 amRNSParadox project update
29th Sep 20237:00 amRNSHalf-year Report
20th Sep 20237:00 amRNSStatement Re Market Speculation
15th Aug 20237:00 amRNSQ2 Williston Basin & State 36-2 LNW-CC Update
26th Jul 202311:39 amRNSResult of AGM
26th Jul 20237:00 amRNSAGM Statement
10th Jul 20237:00 amRNSParadox project update
30th Jun 20235:00 pmRNSTotal Voting Rights
26th Jun 20237:00 amRNSFinal Results
6th Jun 20237:00 amRNSPlacing & Subscription & Project Update
16th May 20237:00 amRNSQ1 Williston Basin & State 36-2 LNW-CC Update
2nd May 20237:00 amRNSHedging programme update
20th Apr 20236:15 pmRNSCorporate Presentation
13th Apr 20234:02 pmRNSInvestor Webinar
11th Apr 20237:00 amRNSState 36-2 LNW-CC well update
20th Mar 20237:00 amRNSState 36-2 LNW-CC well production test to commence
8th Mar 20237:00 amRNSParadox project update
28th Feb 20235:00 pmRNSTotal Voting Rights
15th Feb 20237:00 amRNSQ4 & FY 22 results from Williston Basin portfolio
14th Feb 20237:00 amRNSState 36-2 LNW-CC well update

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