In what may be the last Egypt update from RKH before UOG take over the company report on ASH-2 where 50m of net oil pay are indicated. MDT pressure data indicates the reservoir is in-depleted close to initial reservoir pressure. Al Jahraa-12 is being completed as a reservoir water injector and Al Jahraa SE-1X has had a successful frac job increasing production from approximately 200 bopd to approximately 450 bopd . Current production from Abu Sennan is approximately 5,100 boepd gross or 1,120 to RKH’s 22% WI pre ASH final commissioning.
IOG has announced an update on the Harvey appraisal well following further analysis of the data. Whilst the well itself is a sub-commercial discovery there are a couple of mitigating factors that may in due course lead to a profitable hub development.
This is because the data suggests that the presence of a larger structure at Ha4vey up-dip to the northeast of the pre-well PSDM structure. Add this to the possibility of the Redwell discovery extending further to the northwest than previously estimated which along with the Woodforde prospect might yet provide a profitable hub. Further modelling will take place but in the meantime progress on development of the Core Project phase 1 continues on track. In the meantime the CER Harvey option exercise period has been extended to 27 February 2020.
Sound has announced a proposed placing to raise not less than £1.5m before costs at a price of 2p a share. The proceeds will be used to strengthen the Company’s cash position during the progression of the sale of the Eastern Morocco portfolio.
Should the deal go ahead Sound would expect to receive a gross initial consideration payment of approximately $29.8m but there is yet no binding agreement in place and thus the sale is not guaranteed to progress.
I would put this down as a small top up post the recent election momentum and quite a wise move under the circumstances. I still don’t think that the market has correctly judged this deal which should it go ahead give the company cash, carry to first gas and a residual stake from which to earn royalty payments in one of the best gas markets in the world.
Serica has announced that it has received an out of round award of a 100% interest in the UK petroleum licence P2501, blocks 3/24c and 3/29c. These are located in the area adjacent to the Serica operated Rhum field and contains the HPHT North Eigg and South Eigg prospects.
The primary prospect is North Eigg which is estimated to contain 360 bcf (P 50) and potentially over 1. Tcf of recoverable gas. Any success on the one commitment well leading to a discovery would tick all the boxes as a tie back to Serica’s Bruce platform would reduce unit costs and extend the life of the infrastructure.
This is an important step in Serica’s hub strategy and will remind followers that the company does actually do exploration…. All is going well at the company which should continue to deliver going forward.