Alba Mineral Resources PLC Horse Hill Update (6283D)

TIDMALBA

RNS Number : 6283D

Alba Mineral Resources PLC

10 October 2018

Alba Mineral Resources plc

("Alba" or the "Company")

Extended Well Test ("EWT") Update

Horse Hill-1 ("HH-1") Portland and Kimmeridge Oil Discovery, Weald Basin, UK

Alba (AIM: ALBA), the diversified mineral exploration and development company, is pleased to announce that it has been informed by Horse Hill Developments Ltd ("HHDL" or the "Operator"), the operator of the Horse Hill-1 ("HH-1") Kimmeridge and Portland oil discovery located in licence PEDL137, that the Kimmeridge Limestone 3 ("KL3") EWT programme has recorded sustained light, sweet, 40-41deg API crude oil flow continuously and naturally to surface over the past 50 hours at sustained rates significantly exceeding those recorded during the KL3 short flow test programme in 2016.

Alba holds an 11.765% beneficial interest in licence PEDL137 and adjoining licence PEDL246.

Alba is further advised by the Operator as follows:

   --        KL3 EWT flow sequence commenced ahead of planned KL4 test. 

-- KL3 flowed 40-41deg API continuously and naturally to surface (i.e. without any pump) over a 50 hour initial planned oil flow period. Oil flow initiated instantaneously with minimal pressure "draw- down". First planned 24-hour shut-in and pressure build-up test ("PBU") now underway.

-- Sustained continuous oil rates of between 563 and 771 barrels of oil per day ("bopd") on 36/64 and 38/64 inch choke, respectively, recorded over last 24 hours through test separator. Gas rates up to 186,000 cu ft per day measured through enclosed flare. Flow sustained at constant stable bottom hole pressure.

-- Recorded sustained rates significantly exceed the 464 bopd over a short 7.5-hour total flow period reported in 2016.

-- Initial well productivity index of between 1.4 to 2.5 bpd/psi is around twice that seen in 2016 KL3 test.

   --        To date four tankers of KL3 crude have been exported to Fawley refinery. 

-- Zero formation water produced. Metered associated water rates of 52 barrels per day ("bpd") decreasing to 14 bpd (i.e. 9% decreasing to 2%) in the past 24 hours. Produced water consists wholly of returned heavy completion brine. Well continues to "clean-up" with decreasing water content.

-- Simultaneous pressure data recorded in overlying KL4 is indicative that KL3 and KL4 are one single connected oil pool with an implied minimum vertical extent of 358 ft.

-- Further updates to be provided in due course following completion of the ongoing PBU test, further well clean-up, flow stabilisation, downhole oil sampling and further pressure build up tests.

-- The KL4, which flowed at a reported rate of 901 bopd over a 4-hour period in 2016, will be flow tested after completion of the current KL3 EWT.

It should be noted that these are preliminary results achieved during the well "clean up" phase. Alba awaits from the Operator the final reservoir information in order to ascertain the sustained deliverability of the KL3 and KL4 reservoirs.

George Frangeskides, Alba's Executive Chairman, commented:

"Whilst these are early results from the KL3 EWT sequence, with the well still "cleaning-up", the rates achieved so far in the Kimmeridge limestones are highly encouraging. We look forward to the results of the remainder of the KL3 and KL4 test programme, and look forward also to learning of the Operator's go forward plans for the field development of the Portland sandstone and Kimmeridge limestone reservoirs at Horse Hill".

Qualified Person's Statement

The technical information contained in this announcement has been reviewed and approved by Feroz Sultan (B.Sc (Hons) Geology, M.Sc, Petroleum and Structural Geology, Karachi and M.Sc Petroleum Geology, Imperial College London), a petroleum geologist with over 45 years' experience in the management, exploration, development and production of oil and gas.

The information contained within this announcement is deemed by the Company to constitute inside information under the Market Abuse Regulation (EU) No. 596/2014.

For further information please contact:

Alba Mineral Resources plc

   George Frangeskides, Executive Chairman                           [phone] 

Cairn Financial Advisers LLP (Nomad)

   James Caithie / Liam Murray                                               [phone] 

First Equity Limited (Broker)

   Jason Robertson                                                               [phone] 
 
 
   Yellow Jersey PR (Financial PR/ 
   IR) 
  Tim Thompson / Harriet Jackson 
   [e-mail]            [phone] 
 

Glossary

 
 discovery       a discovery is a petroleum accumulation for which 
                  one or several exploratory wells have established 
                  through testing, sampling and/or logging the existence 
                  of a significant quantity of potentially moveable 
                  hydrocarbons 
 draw down       the difference between the average static reservoir 
                  pressure and the flowing bottomhole pressure 
                --------------------------------------------------------- 
 extended well   a well test, as per the permission granted by 
  test            the Oil and Gas Authority, with an aggregate flow 
                  period duration over all zones of greater than 
                  96 hours and up to 90 days maximum 
                --------------------------------------------------------- 
 Flow test       a flow test or well test involves testing a well 
                  by flowing hydrocarbons to surface, typically 
                  through a test separator. Key measured parameters 
                  are oil and gas flow rates, downhole pressure 
                  and surface pressure. The overall objective is 
                  to identify the well's capacity to produce hydrocarbons 
                  at a commercial flow rate 
                --------------------------------------------------------- 
 Productivity    A mathematical means of expressing the ability 
  Index           of a reservoir to deliver fluids to the wellbore. 
                  The PI is usually stated as the volume delivered 
                  per psi of drawdown at the sandface (bbl/d/psi). 
                --------------------------------------------------------- 
 

Alba's Project Portfolio

Mining

Amitsoq (Graphite, Greenland): Alba owns a 90 per cent interest in the Amitsoq Graphite Project in Southern Greenland and has an option over the remaining 10 per cent.

Clogau (Gold, Wales): Alba owns a 90 per cent interest in Gold Mines of Wales Limited ("GMOW"), the ultimate owner of the Clogau Gold project situated in the Dolgellau Gold Belt in Wales.

Inglefield Land (Copper, Cobalt, Gold): Alba owns 100 per cent of mineral exploration licence 2017/40 in north-west Greenland.

Limerick (Base Metals, Ireland): Alba owns 100 per cent of the Limerick base metal project in the Republic of Ireland.

Melville Bay (Iron Ore, Greenland): Alba is entitled to a 51 per cent interest in mineral exploration licence 2017/41 in Melville Bay, north-west Greenland. The licence area benefits from an existing inferred JORC resource of 67 Mt @ 31.4% Fe.

Thule Black Sands (Ilmenite, Greenland): Alba owns 100 per cent of mineral exploration licences 2017/29 and 2017/39 in the Thule region, north-west Greenland.

Oil & Gas

Brockham (Oil & Gas, UK): Alba has a direct 5 per cent interest in Production Licence 235, which comprises the previously producing onshore Brockham Oil Field.

Horse Hill (Oil & Gas, UK): Alba holds a 18.1 per cent interest in Horse Hill Developments Limited, the company which has a 65 per cent participating interest and operatorship of the Horse Hill oil and gas project (licences PEDL 137 and PEDL 246) in the UK Weald Basin.

Web: www.albamineralresources.com

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October 10, 2018 08:55 ET (12:55 GMT)