Alba Mineral Resources PLC Horse Hill Update (2884Q)

TIDMALBA

RNS Number : 2884Q

Alba Mineral Resources PLC

18 February 2019

Alba Mineral Resources plc

("Alba" or "the Company")

Update on Portland Oil Production at Horse Hill-1 ("HH-1")

Alba Mineral Resources plc (AIM: Alba) ("Alba" or the "Company"), the diversified mineral exploration and development company, announces that Horse Hill Developments Ltd ("HHDL" or the "Operator"), the operator of the HH-1 Kimmeridge Limestone ("KL") and Portland Sandstone ("Portland") oil discovery ("HHDL" or the "Operator"), has informed the Company that Portland oil production has been re-established from the Horse Hill-1 ("HH-1") well in which the Company has an 11.765% interest.

The Operator further advises as follows:

- The resumption of continuous Portland dry oil flow (i.e. oil with zero water content), at a stable daily rate of between 208 and 218 bopd ("barrels per day"), forms a key part of the schedule of works required to finalise the Portland field development plan and to the targeted establishment of permanent long-term Portland production, planned by end 2019.

- The total production figures to date from the extended well test ("EWT") at Horse Hill are as follows:

- Over 30,200 barrels ("bbl") of aggregate KL and Portland oil production (comprising over 25,000 bbl of total KL production and over 5,100 bbl of total Portland production).

   -   142 tankers of sales crude exported primarily to Perenco's Hamble oil terminal. 

- The 40deg API Brent quality crude of KL production contained no produced water and has been sold at prevailing Brent crude oil prices, less a small deduction for handling and marketing.

- For prudent reservoir management purposes, the average test production rate from the 114 ft vertical perforated Portland section has been maintained below the previously reported 362 bopd calculated optimised sustainable rate. HH-1 test production is planned to continue until the completion of the new HH-2 Portland well, scheduled to start in spring 2019 subject to receipt of all necessary approvals (noting that planning and environmental permits are already in place), and that Portland test production would then be switched over to HH-2.

- In tandem with Portland operations, the KL oil pool was shut-in to conduct a further long-term pressure build up test. Pressure gauges, set within the KL reservoir, will monitor the KL reservoir whilst the Portland is flowed.

- Resumption of continuous KL test production is now planned to follow directly after the drilling of HH-2. Initially via a short flow test period from HH-1, then by further long-term production testing of the new HH-1z KL side-track, subject to receipt of all necessary approvals (noting that planning and environmental permits are already in place).

George Frangeskides, Alba's Executive Chairman, commented: "We are pleased to see the resumption of test production from the Portland Sandstone and look forward to further reports from the Operator as the test programme continues."

Glossary

 
 degAPI          a measure of the density of crude oil, as defined 
                  by the American Petroleum Institute 
 oil field       an accumulation, pool or group of pools of oil 
                  in the subsurface that produces oil to surface. 
                --------------------------------------------------------- 
 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. 
                --------------------------------------------------------- 
 side-track      re-entry of a well from the well's surface location 
                  with drilling equipment for deviating from the 
                  existing well bore to achieve production or well 
                  data from an alternative zone or bottom hole location 
                --------------------------------------------------------- 
 

This announcement contains inside information for the purposes of Article 7 of EU Regulation 596/2014.

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.

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 / Henry Wilkinson            [phone] 

[e-mail]

Alba's Project & Investment 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 ("MEL") 2017/40 and 2018/25 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 MEL 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 MEL 2017/29 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 an 11.765 per cent effective interest in the Horse Hill oil and gas project (licences PEDL 137 and PEDL 246 covering a total area of 142.9 km(2)) in the UK Weald Basin.

Web: www.albamineralresources.com

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February 18, 2019 02:00 ET (07:00 GMT)