Eland Oil & Gas PLC Opuama-7 side-track and Work Programme Update (2672U)

TIDMELA

RNS Number : 2672U

Eland Oil & Gas PLC

23 October 2017

23 October 2017

Eland Oil & Gas PLC

("Eland" or the "Company")

Opuama-7 side-track and Work Programme Update

Eland Oil & Gas PLC (AIM: ELA), an oil & gas production and development company operating in West Africa with an initial focus on Nigeria, is pleased to announce that its joint-venture subsidiary Elcrest Exploration and Production Nigeria Ltd, has successfully completed sidetrack drilling at Opuama-7.

The Opuama-7 sidetrack encountered both D1000 and D2000 sands as expected with a total of 77 feet of good quality net pay. Over 60ft of the D2000 sands have been successfully perforated and the well is currently being completed and hooked up so production can commence imminently, with gross production flow rates expected to be in line with previous guidance of 5,900 bopd. The D1000 sands will be perforated at a future date to maintain the production rate. The Company will make a further announcement once an initial stabilised production rate from the Opuama-7 well is achieved.

In light of the success of the Opuama-3 recompletion in 2016 and the positive results of the Opuama-7 sidetrack, the Company is bringing forward its plans for infill drilling on the Opuama Field, taking advantage of having the rig in Opuama and to accelerate production growth through the existing production infrastructure. The Company and its partner NPDC have elected to retain the OES Teamwork drilling rig to drill an Opuama infill well immediately. Whilst Opuama-7 is being hooked-up for immediate injection into the Opuama facilities, and OML 40 export line, the rig will mobilise to the Opuama-8 drill site. Opuama-8 to is expected to produce at an initial gross rate of between 5,000 and 7,000 bopd. Targeting the D4000 and D5000 reservoirs to a depth of approximately 8000ft.

Production performance from OML 40 remains strong, with average production from July 1st to 20(th) October of circa 12,000 bopd from Opuama-1 and Opuama-3. We are delighted to report that uptime during the period is running at 99.0%, the most consistent performance to date from OML 40.

We are also pleased to announce that a lifting of 171,000 barrels of oil took place in September at an average price of $54.66 per barrel, generating revenues of $9.3 million. Payment for this lifting is due by the end of October.

George Maxwell, CEO of Eland, commented:

"Elcrest's on schedule completion of the Opuama-7 sidetrack is an excellent result for the Company, and continues to show the strong planning and operational capability of our team. I look forward to updating the market on what we expect to be a further significant increase to the Opuama production base"

"The drilling of Opuama-8 has the potential to add further material production of an initial 5,000 to 7,000 bopd with strong revenues in a short time frame. Following Opuama-8, the OML 40 JV intends to drill a further one or two infill wells on Opuama. Together with our partner NPDC, the Company has tripled production form Opuama in the last 18 months and following a successful Opuama-7 and infill campaign is expected to double production again by the end of Q1 2018. We remain committed to developing OML 40 to its full potential and optimising our attractive acreage position in a capital efficient manner and look forward to the re-entry and completion of Gbetiokun-1 in 2018."

For further information:

Eland Oil & Gas PLC ([phone])

www.elandoilandgas.com

George Maxwell, CEO

Ronald Bain, CFO

Finlay Thomson, IR

Canaccord Genuity Limited ([phone])

Henry Fitzgerald O'Connor / James Asensio

Panmure Gordon (UK) Limited ([phone])

Adam James / Atholl Tweedie

Tom Salvesen

Camarco ([phone])

Billy Clegg / Georgia Edmonds / Tom Huddart

In accordance with the guidelines of the AIM Market of the London Stock Exchange, Pieter van der Groen, a geologist and Eland's Chief Operating Officer, who has a geology degree from Auckland University, a Masters degree in Petroleum Geology from the University of Aberdeen and has over 25 years of relevant experience in the upstream oil and gas industry and who is a member of the Society of Petroleum Engineers and meets the criteria of qualified person under the AIM guidance note for mining and oil and gas companies, has reviewed and approved the technical information contained in this announcement.

Notes to editors:

Eland Oil & Gas is an AIM-listed independent oil and gas company focused on production and development in West Africa, particularly the highly prolific Niger Delta region of Nigeria.

Through its joint venture company Elcrest, Eland's core asset is OML 40 which is located in the Northwest Niger Delta approximately 75km northwest of Warri and has an area of 498km(2). In addition, the Company has a 40% interest in the Ubima Field, onshore Niger Delta, in the northern part of Rivers State.

The OML 40 licence holds gross 2P reserves of 83.2 mmbbls, gross 2C contingent resources of 41.2 mmbbls and a best estimate of 254.5 mmbbls of gross unrisked prospective resources. The Ubima field holds gross 2P reserves of 2.4 mmbbls of oil and gross 2C resource estimates of 31.1 mmbbl.

Net production figures relate to Elcrest Exploration and Production Nigeria Ltd ("Elcrest"), Eland's joint venture company. Production rates, are as measured at the Opuama PD meter, are subject to reconciliation and will differ from sales volumes.

The information contained within this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014. Upon the publication of this announcement, this inside information is now considered to be in the public domain.

This information is provided by RNS

The company news service from the London Stock Exchange

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October 23, 2017 02:00 ET (06:00 GMT)