Petroneft Resources PLC Operations Update (6080Y)

TIDMPTR

RNS Number : 6080Y

Petroneft Resources PLC

10 September 2015

PetroNeft Resources plc

("PetroNeft" or the "Group" or the "Company")

Operations Update

PetroNeft (AIM: PTR) an oil & gas exploration and production company operating in the Tomsk Oblast, Russian Federation, and 50% owner and operator of Licences 61 and 67 is pleased to provide an update on operations at Licence 61.

Highlights

Tungolskoye

   --   T-502 horizontal well brought on line at sustained rate of over 450 bopd. 
   --   T-503 horizontal well currently producing at around 400 bopd. 
   --   T-507 control well and water injector spudded on 25 August. 

West Lineynoye

   --    L-10 horizontal well currently producing at a sustained rate of 130 bopd. 

Production

   --    Current gross production from Licence 61 is about 2,700 bopd. 
   --    Represents a 46% increase in production in 2015. 

Tungolskoye Development

The T-502 well at Tungolskoye has been successfully completed with a horizontal segment of 982 metres in the Upper Jurassic J1-1 horizon at a depth of approximately 2,502 metres TVD. Of the 982 metres horizontal segment it is estimated that approximately 624 metres is in effective net pay. The well was brought online on 27 August and the average flow rate over the last eleven days has been over 450 bopd. The well is still cleaning up, with the water cut now below 20% and will be allowed to continue in this mode to monitor performance.

The T-503 well at Tungolskoye is currently producing about 400 bopd. The average water cut is now about 10% and the well is establishing what we believe to be a long term production trend.

The T-507 vertical well was spudded on 25 August and drilled to total depth of 3,262 m in 10 days, a record for a well on Licence 61. The well is currently being logged. The primary purpose of this well is to provide stratigraphic information for the drilling of the T-501 horizontal well which will commence shortly. The T-507 well will eventually be used as a water injector to provide pressure support for the T-502 and T-501 horizontal wells.

Production

Current gross production at Licence 61 is about 2,700 bopd including 130 bopd from the L-10 well at West Lineynoye. This represents over 40% production uplift in 2015 to date, predominantly driven by successful execution of horizontal wells. Initial decline rates for the horizontal wells are stabilizing and performance data from the Tungolskoye and West Lineynoye horizontal wells is being factored into future drilling designs. This will include a longer planned clean-up and stabiliisation period before reporting initial well rates.

Dennis Francis, Chief Executive Officer of PetroNeft Resources plc, commented:

"We are very pleased with the T-502 well result, which is in line with our expectations and again clearly demonstrates the potential for materially enhanced flow rates from horizontal production wells especially when we are able to successfully drill and complete long horizontal segments.

Our operational progress is gathering momentum and this is evident in our sustained drilling and production growth. We are now looking forward to the T-507 vertical well and T-501 horizontal well results. Production has increased by over 40% in 2015 and we will continue to focus on production growth."

For further information, contact:

 
                                                           +1 713 988 
 Dennis Francis, CEO, PetroNeft Resources plc                    2500 
                                                           +353 1 647 
 Paul Dowling, CFO, PetroNeft Resources plc                      0280 
 John Frain/Brian Garrahy, Davy (NOMAD and Joint           +353 1 679 
  Broker)                                                        6363 
 Henry Fitzgerald-O'Connor, Canaccord Genuity Limited     [phone] 
  (Joint Broker)                                                 8000 
                                                          [phone] 
 Martin Jackson/Shabnam Bashir, Citigate Dewe Rogerson           9571 
                                                           +353 1 498 
 Joe Heron / Douglas Keatinge, Murray Consultants                0300 
 

The information contained in this announcement has been reviewed and verified by Mr. Dennis Francis, Director and Chief Executive Officer of PetroNeft, for the purposes of the Guidance Note for Mining and Oil & Gas Companies issued by the London Stock Exchange in June 2009. Mr. Francis holds a B.S. Degree in Geophysical Engineering and a M.S. Degree in Geology from the Colorado School of Mines. He has also graduated from the Harvard University Program for Management Development. He is a member of the American Association of Petroleum Geologists and the Society of Exploration Geophysicists. He has over 40 years' experience in oil and gas exploration and development.

Glossary

 
 bopd   Barrels of oil per day 
-----  ----------------------- 
 TVD    True vertical depth 
-----  ----------------------- 
 

This information is provided by RNS

The company news service from the London Stock Exchange

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September 10, 2015 02:01 ET (06:01 GMT)