Proactive weekly oil & gas highlights: Genel, 88 Energy, Falcon Oil & Gas, United, Sound Energy, Tower Resources, Anglo African
Companies with production were in focus this week as fourth quarter updates were released across the sector, and, on Thursday, Genel Energy PLC (LONGENL) CEO Bill Higgs has celebrated 2019 as a “successful year” for the Iraq focussed oil and gas firm.
In a trading update, ahead of full-year financial results due for release on 17 March, the group told investors that it delivered some 36,250 barrels of net oil production per day from the Kurdistan region of Northern Iraq. The company pointed out that it brought 19 wells into production during 2019.
In terms of financials, Genel said that it received some US$317mln of cash proceeds from the Kurdish authorities in 2019, while the groups free cash flow amounted to US$99mln before dividends.
Earlier, on Tuesday, Genel highlighted a trading update released by DNO – its partner in Kurdistan – which reported an increase in production volumes from the Tawke field.
The Tawke licence, which is host to two fields, produced 124,000 barrels of oil per day (bopd) in 2019, up from 113,100 bopd in 2018. At the Tawke field itself production amounted to 68,000 bopd as newly drilled wells supported operations, while the Peshkabir field flowed with 55,200 bopd of production thanks to new wells which added around 40%
In the fourth quarter, gross production from the licence measured 122,800, marking an improvement of 3,000 bopd in the preceding three-month period. Genel owns a 25% interest in the Tawke licence, along with a 44% interest in the Taq Taq licence.
88 Energy Ltd (LON:88E) has told investors that the preparation for the Charlie-1 well is “progressing to plan” with spudding expected soon. In a statement, he Alaska-focused explorer said that ice road construction is underway and its base layer is presently about 25%.
A permit to drill has been submitted, with approval expected in January. It said that a more accurate forecast for the anticipated February spud along with the timings for drilling, logging and testing will be communicated in due course.
Australia focussed explorer Falcon Oil & Gas Ltd (LON:FOG, CVE:FO) said that the Kyalla 117 N2-1H well, at the Beetaloo shale project, will undergo sidetrack drilling after the wells original horizontal section experienced operational challenges.
The Australian shale wells vertical section was completed in November, and, horizontal drilling subsequently began in early December. After 700 metres – of a section intended to span at least 1,000 metres – drilling challenges were encountered affecting the maintenance of clean hole conditions and stability in certain sections.
As a result, the original production section will be plugged, in line with regulatory requirements, before the sidetracking and drilling of a new horizontal production section. The company noted that such work is not uncommon in an exploration drilling program like this.
It is expected that the new drilling will start next month. Fracture stimulation activity will only occur after the successful completion of drilling and the integrity of the well is tested and verified.
United Oil & Gas PLC (LON:UOG) reported that Tullow Oil PLC (LON:TLW), partner and operator for its high potential Jamaica exploration project, reached an agreement with the Jamaican authorities to extend the initial exploration licence period by six months. It means that a drill or drop decision will need to take place before 31 July 2020, rather than 31 January 2020.
A joint farm-out partnering process is presently underway, led by Tullow, ahead of anticipated exploration drilling programme in 2021 to test the Colibri prospect (estimated to host some 229mln of potential resources). In Tuesdays statement, United noted that a number of interested parties are continuing their evaluation of the licence data, and the extension was granted to provide sufficient time for these to be completed.
In Morocco, Sound Energy PLC (LON:SOU) extended negotiations over the gas sales agreement for the Tendrara gas project in eastern Morocco, with a new deadline of 31 March 2020. It comes as the company continues to move Tendrara towards a Final Investment Decision.
The company is working on a build-own-operate-transfer funding solution for the infrastructure development that will support Tendrara, it noted.
The Environmental Impact Assessment (EIA) approvals process is progressing well, with a second meeting with the Moroccan Ministry of Energy, Mines and Environment to review the document on 28 January – following the first meeting, which took place in October. At the January meeting the committee will consider and, if agreed, approve the EIA.
[contf]
[contfnew]
Proactiveinvestors
[contfnewc]
[contfnewc]
