Petroneft Resources PLC Operations Update (8036E)

TIDMPTR

RNS Number : 8036E

Petroneft Resources PLC

21 July 2016

21 July 2016

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

Fourth successful well drilled at South Arbuzovskoye

Further increases to record production levels

Production

-- Current gross production from Licence 61 increased to about 3,700 bopd (1,850 bopd net to PetroNeft)

   --    Increase due to new A-216 well at Arbuzovskoye 

-- This is a new record high production for the Licence area, improving further the levels reported at the beginning of the month

Arbuzovskoye Well A-216 - New Deviated Production Well

               --     Two sandstone reservoirs with net pay of 11.4 m identified 
               --     Initial stabilised production of 175 bopd 

Sibkrayevskoye Well S-374 - Vertical Delineation Well

               --     Spudded on 3 July 
               --     Results expected in August 

South Arbuzovskoye Development

The Arbuzovskoye well A-216 was spudded on 20 June 2016 and is a deviated (vertical in the reservoir) production well located to the south of well A-213. The well was not in the original firm work programme but has been added based on the successful results of the A-213, A-214 and A-215 wells. It provides an additional drainage point on the southern end of the structure and targeted the J1-1 and J1-2 intervals as seen in the A-213 well.

The reservoir interval in the well was cored and the well was then drilled to a total depth 2,733 m MD and logged. The initial evaluation indicates that two sandstone reservoirs with total net pay of 11.4 m have been identified based on log and core analysis.

   --     Upper Jurassic J1-1 (-2,462.4 to -2,465.4 m TVDSS) net pay 3.0 m 
   --     Upper Jurassic J1-2 (-2,467.7 to -2,476.1 m TVDSS) net pay 8.4 m 

The well was perforated in both intervals and the initial production has now stabilized at around 175 bopd with 15% water.

A-216 is the final well in the programme at South Arbuzovskoye.

Production

Current gross production from Licence 61 is about 3,700 bopd (1,850 bopd net to PetroNeft). This represents a new record production for the Licence area and arises from the good results of the four wells at Arbuzovskoye this year. The production thus far from the new wells at South Arbuzovskoye confirm that while there is some decline, it is not of the magnitude of decline experienced at Tungolskoye. This is due to the good reservoir properties and the thickness of the reservoir at Arbuzovskoye as compared to Tungolskoye.

Sibkrayevskoye Development

The S-374 delineation well was spudded on 3 July 2016. This is a delineation well on the southern portion of the field designed to further de-risk the development and move P3 to P2 reserves. A result is expected in August 2016. All of the necessary studies and approvals are being completed in order to commence development of Sibkrayevskoye in Q1 2017.

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

"We are very pleased with the outcome of the South Arbuzovskoye development programme which included both deviated and horizontal wells. We are planning to use a similar approach in the development of the Sibkrayevskoye field which we are working to sanction for development in 2017.

In the near term we look forward to completion of the S-374 delineation well at Sibkrayevskoye which will further define the field and upgrade existing proved and probable reserves. Following this, our attention is turning to the planning and development work which will underpin our next drilling campaign."

For further information, contact:

 
 Dennis Francis, CEO, PetroNeft Resources    +1 713 988 
  plc                                              2500 
 Paul Dowling, CFO, PetroNeft Resources      +353 1 443 
  plc                                              3720 
 John Frain/Brian Garrahy, Davy (NOMAD       +353 1 679 
  and Joint Broker)                                6363 
 Henry Fitzgerald-O'Connor, Canaccord           +44 207 
  Genuity Limited (Joint Broker)               523 8000 
 Martin Jackson/Shabnam Bashir, Citigate        +44 207 
  Dewe Rogerson                                638 9571 
 Joe Heron / Douglas Keatinge, Murray        +353 1 498 
  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

 
 2P reserves   Proved and probable reserves as 
                defined by the standards of the 
                Society of Petroleum Engineers 
------------  --------------------------------- 
 bopd          Barrels of oil per day 
------------  --------------------------------- 
 m             metres 
------------  --------------------------------- 
 MD            Measured depth 
------------  --------------------------------- 
 P2 reserves   Probable reserves as defined by 
                the standards of the Society of 
                Petroleum Engineers 
------------  --------------------------------- 
 P3 reserves   Possible reserves as defined by 
                the standards of the Society of 
                Petroleum Engineers 
------------  --------------------------------- 
 TVDSS         True vertical depth subsea 
------------  --------------------------------- 
 

This information is provided by RNS

The company news service from the London Stock Exchange

END

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July 21, 2016 02:00 ET (06:00 GMT)