Springs Road-1 Well Results

RNS Number : 5590D

Egdon Resources PLC

27 June 2019

 

27 June 2019

EGDON RESOURCES PLC

 ("Egdon" or "the Company")

Springs Road-1 SR-01 Shale Exploration Well Results

Egdon Resources plc is pleased to note the announcement made this morning by IGas Energy plc ("IGas") which summarises the results from the analysis of whole core from the Springs Road-1 ("SR‑ 01") well on licence PEDL140, in which Egdon holds a 14.5% interest.

The IGas release states;

"IGas is delighted to announce highly encouraging core analysis results from its SR-01 exploration well at Springs Road in North Nottinghamshire. The well is a significant step forward in the development of shale gas in the East Midlands.

The Springs Road well was drilled as a vertical, cored exploration well in PEDL140 in North Nottinghamshire in the centre of the Gainsborough Trough basin.  The well sought to assess three target zones: the Bowland Shale; the Millstone Grit and the Arundian Shale.  All three targets were encountered, with 429m of hydrocarbon bearing shales encountered within the primary target, the Bowland Shale. 

IGas acquired 147 metres of core within the Bowland Shale, the first extensive core sample from this basin, which has subsequently been analysed by Stratum Reservoir (formerly Weatherford Labs) in their laboratories in both the UK and the USA.

The results from core analysis are extremely positive and confirm that a significant hydrocarbon resource is present in the Gainsborough Trough.     

•           Total Organic Carbon (TOC): 2 - 7 %, average of c. 3 %

•           Thermal maturity (Tmax): Average of 464°C (wet gas to dry gas window)

•           Total Porosity:  2 - 9 %, average of 4 %

•           Gas Content: 24 - 131 scf/ton, average of 71 scf/ton

•           Average Clay Content: c.30 wt.%

The key characteristics of the Bowland Shale in SR-01 compare favourably to commercial shale operations observed in North America such as the Permian and the Marcellus. The core results indicate a mature, organic rich source rock with good porosity confirming favourable gas resource density.  In particular, the low clay content is encouraging and an indication that hydraulic fracturing of the rock should be effective.

The analysis conducted will help delineate the resource potential and help refine the subsequent appraisal programme.  IGas, working with its joint venture partners, will now consider the attributes of the data set in order to commence planning for both the appraisal programme and pilot development within the Gainsborough Trough, including redefining the basin model.

We intend to make a further announcement and full technical presentation of the results, including comparison with analogous US shale plays in the third quarter of 2019.

Commenting IGas CEO, Stephen Bowler, said

"This positive dataset is highly promising and materially advances our understanding of the hydrocarbon resources contained within the shales in the Gainsborough trough where IGas holds a large acreage position.  We were particularly pleased with operational performance during drilling leading to the well costs coming in c.20% under budget.

The independent Committee on Climate Change recently reported that by 2050 we will still require some 70% of the gas we currently consume but unless we develop our domestic resources, we will need to import 86% of that gas from overseas. 

These results demonstrate that within the East Midlands we potentially have the resources to produce gas, creating jobs and tax revenues whilst reducing our greenhouse gas emissions."

Commenting on these results, Mark Abbott, Managing Director of Egdon Resources plc, said:

"The results from this extensive modern core dataset demonstrate that the Bowland Shale of the Gainsborough Trough, where Egdon holds 82,000 net acres, compares favourably with some of the best US commercial shale operations and is potentially world class.  

We echo IGas' satisfaction at the speed and cost of drilling which bodes well for future operations.   We look forward to providing investors with a more detailed update during the third quarter of 2019 once these results have been fully assessed and integrated. "

For further information please contact:

Egdon Resources plc

Mark Abbott/ Martin Durham                                                      01256 702 292

Buchanan

Ben Romney, Chris Judd                                                           020 7466 5000

Nominated Adviser and Broker - Cantor Fitzgerald Europe                 

David Porter/ Rick Thompson (Corporate Finance)                      020 7894 7000

Caspar Shand Kydd (Sales)

Joint Broker - VSA Capital Limited

Andrew Monk (Corporate Broking)                                              020 3005 5000

Andrew Raca (Corporate Finance)

Notes to Editors:

Gainsborough Trough

Egdon has extensive operated and non-operated acreage interests in the Gainsborough Trough unconventional gas plays in the East Midlands.

Egdon are the third largest net acreage holder in the Gainsborough Trough play with 82,000 net acres with shale/tight gas potential.

Egdon's licences in the Gainsborough Trough contain an estimated 20 TCF of net Undiscovered GIIP in Upper and Lower Bowland-Hodder Shales (or 40% of Egdon's total net undiscovered unconventional resources GIIP of 51 TCF (ERCE 2014 and 2016 see below). The Springs Road-1 well is the first modern well employing the latest logging and coring techniques to test these Carboniferous age tight gas and shale gas plays with Egdon's acreage.

Further information on the Gainsborough Trough is available on our website at http://www.egdon-resources.com/gainsborough-trough/ and http://www.egdon-resources.com/operations/uk/east-midlands/ 

Further information on the Springs road well can be found at the operator IGas' engagement website http://www.igas-engage.co.uk/our-work-in-north-nottinghamshire/ 

Egdon Resources plc (LSE: EDR) is an established UK-based exploration and production company focused on onshore exploration and production in the hydrocarbon-producing basins of the UK. 

Egdon holds interests in 44 licences in the UK and has an active programme of exploration, appraisal and development within its portfolio of oil and gas assets.  Egdon is an approved operator in the UK. 

Egdon was formed in 1997 and listed on AIM in December 2004.

ERCE Estimates

ERCE's estimates of undiscovered GIIP are subject to exploration risk, which may be considerable. ERCE has not assessed this risk as no Prospective Resources have yet been attributed to these properties by Egdon and ERCE, and further geoscientific and engineering data need to be acquired to be able to quantify these resources. ERCE notes that mining of the overlying coal measures has occurred in a number of the licences, which may affect site access and drilling operations. In the case where Prospective Resources are identified within these licences, there is no certainty that any portion of the resources will be discovered. If discovered, there is no certainty that it will be commercially viable to produce any portion of the resources.

Qualified Person Review

In accordance with the AIM Rules - Note for Mining and Oil and Gas Companies, this release has been reviewed by Mark Abbott, Managing Director of Egdon, who is a geoscientist with over 30 years' experience and is a member of the Petroleum Exploration Society of Great Britain and a Fellow of the Geological Society.  Mr Abbott has consented to the inclusion of the technical information in this release in the form and context in which it appears.

Evaluation of hydrocarbon volumes has been assessed in accordance with 2007 Petroleum Resources Management System prepared by the Oil and Gas Reserves Committee of the Society of Petroleum Engineers (SPE) and reviewed and jointly sponsored by the World Petroleum Council (WPC), the American Association of Petroleum Geologists (AAPG) and the Society of Petroleum Evaluation Engineers (SPEE).

The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014 ("MAR"). Upon the publication of this announcement via Regulatory Information Service ("RIS"), this inside information is now considered to be in the public domain

 

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