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Eland Oil & Gas PLC (ELA)

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Tuesday 18 September, 2018

Eland Oil & Gas PLC

Opuama and Ubima Update

RNS Number : 0433B
Eland Oil & Gas PLC
18 September 2018
 

18 September 2018

Eland Oil & Gas PLC

("Eland" or the "Company")

 

Opuama and Ubima Update

Eland Oil & Gas PLC (AIM: ELA), an oil & gas production and development company operating in West Africa with an initial focus on Nigeria, is pleased is pleased to announce the following update on the Opuama-10 and Opuama-11 wells in licence OML 40 and Ubima.

Opuama

The Company, through its joint-venture subsidiary Elcrest Exploration and Production Nigeria Ltd ("Elcrest") has continued testing and production of the two reservoirs penetrated by the Opuama-10 well. The long string producing from the deepest of these reservoirs the D5000, flowed at 3,159 barrels of oil per day ("bopd") on a 40/64" choke with a flowing tubing head pressure ("FTHP") of 63 bar (914 psi) and the short string, producing from the D1000, flowed at 3,739 bopd on a 44/64" choke with a FTHP of 28 bar (406 psi). It is expected following completion of testing that stabilised initial production from Opuama-10 will be in excess of 5,500 bopd with aggregate production from the Opuama field expected to average above 29,000 bopd (13,050 bopd net to Elcrest).

Furthermore, the OES Teamwork Rig has drilled Opuama-11 to total true vertical depth of 7,914 feet and the final casing string has been run and cemented. The three target zones, D3500, D4000 and D2000 reservoirs recorded aggregated net pay of 185 feet of apparent vertical thickness. The D3500 and D4000 reservoirs will be perforated at this stage and a Maximum Efficiency Rate Test ("MER Test") incrementally testing the well at increasing choke sizes will be performed. Initial production from the test is expected in September. It is expected that initial gross production from Opuama-11 will be between 4,000 and 6,000 bopd (1,800 to 2,700 bopd net to Elcrest).

Ubima Appraisal

Well testing operations on Ubima are currently in progress on the D1000 reservoir to gather important information on oil characteristics and reservoir performance. To date, the F7000 reservoir was tested at flow rates of up to 2,500 bopd. Upon completion of the D1000 test, the potential to test the E1000/E2000 will be evaluated and the well will be completed with a dual completion with the KCA Deutag T-57 rig. The Company will update on the Ubima appraisal's progress further as operations continue.

George Maxwell, CEO of Eland, commented:

"We are delighted to announce the continued success of the Opuama drilling campaign with another well producing above expectation. Having achieved our previous production guidance, the addition of Opuama-11 production in the next month will take aggregate production from Opuama field above 30,000 bopd.

This will be a record production milestone for the Company and the OML 40 Joint Venture partners and will confirm our position as one of the biggest oil producers on AIM, ensuring sustainable cashflow for further development of our assets and the refinancing and upscaling of our debt line.

 

The successful test of the deeper zone on the Ubima-1 well is a significant step towards the Company achieving a strategic target of a second producing asset. I look forward to updating on the Ubima appraisal's progress further as operations continue."

 

For further information:

 

Eland Oil & Gas PLC (+44 (0)1224 737300)

www.elandoilandgas.com

George Maxwell, CEO

Ronald Bain, CFO

Finlay Thomson, IR

 

Canaccord Genuity Limited (+44 (0)20 7523 8000)

Henry Fitzgerald O'Connor / James Asensio

 

Panmure Gordon (UK) Limited (+44 (0)20 7886 2500)

Adam James / Atholl Tweedie / James Stearns 

Camarco (+44 (0) 203 757 4980)

Billy Clegg / Georgia Edmonds / Tom Huddart

 

 
In accordance with the guidelines of the AIM Market of the London Stock Exchange, Yannis Korakakis, MSc of Leoben University, with 32 years of experience in the oil and gas sector, is a Petroleum Engineer and member of the Society of Petroleum Engineers who meets the criteria of qualified persons under the AIM guidance note for mining and oil and gas companies, has reviewed and approved the technical information contained in this announcement.

 

Notes to editors:

Eland Oil & Gas is an AIM-listed independent oil and gas company focused on production and development in West Africa, particularly the highly prolific Niger Delta region of Nigeria.

Through its joint venture company Elcrest, Eland's core asset is a 45% interest in OML 40 which is in the Northwest Niger Delta approximately 75km northwest of Warri and has an area of 498km². 

In addition, the Company has a 40% interest in the Ubima Field, onshore Niger Delta, in the northern part of Rivers State.

The OML 40 licence holds gross 2P reserves of 83.4 mmbbls, gross 2C contingent resources of 40.4 mmbbls and a best estimate of 254.5 mmbbls of gross un-risked prospective resources*

The Ubima field holds gross 2P reserves of 2.4 mmbbls of oil and gross 2C resource estimates of 31.1 mmbbl**

Net production figures relate to Elcrest Exploration and Production Nigeria Ltd ("Elcrest"), Eland's joint venture company. Production rates, when oil is exported via Forcados, are as measured at the Opuama PD meter, are subject to reconciliation and will differ from sales volumes.

*Netherland, Sewell & Associates Inc CPR report 31 December 2017

**AGR TRACS April 2016

 


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