Frontera Resources Corporation Update on Ud-2 well (5244C)

TIDMFRR

RNS Number : 5244C

Frontera Resources Corporation

22 January 2018

22 January 2018

Frontera Resources Corporation

("the Company")

Update on Ud-2 well

Frontera Resources Corporation (AIM: FRR), the European focused oil and gas exploration and production company, is pleased to provide an update regarding interim results on testing of the Ud-2 well, situated inside the 950km(2) Mtsare Khevi Gas Complex area, located in onshore Block 12, Georgia.

Sustained deliverability of natural gas from the Gareji formation has been confirmed during Stage 2 of the current stimulation and testing program. The flowing interval, for Stage 2 testing, which is situated between 2519m - 2554m has indicated the presence of commercial gas within the Miocene-aged Gareji reservoir.

State Oil and Gas Service Company has performed analysis of the flowed natural gas. Chemical composition is shown below:

Methane - 94.58%

Ethane - 2.50%

Propane - 1.90%

Nitrogen - 0.43%

Others - 0.59%

Lower Calorific value - 9230 kcal/m(3) (State standard: not less than 7600 kcal/m(3) )

Higher Calorific value - 9910 kcal/m(3)

The natural gas quality satisfies all requirements of the applicable GOST standard and corresponds to the applicable regulations of the State Standard 5542-87, which makes it acceptable for distribution through Georgia's natural gas grid.

As previously announced on 28 November 2017, residual formation debris ('skin damage') from historical drilling operations was encountered together with natural gas flow during Stage 1 flowback operations while testing Miocene aged Gareji reservoir interval situated between 2600m - 2620m.

Debris-free natural gas flow has now been successfully established following the modifications to the perforation, stimulation and flowback design for Stage 2 operations, while testing Miocene aged Gareji reservoir interval situated between 2519m - 2554m. For reference, Stage 1 was completed with 15 metric tons of proppant whereas Stage 2 included a 20 metric tons of proppant stimulation.

Post Stage 2 stimulation analysis has determined that the contributing intervals to current natural gas production are less than 15% of the perforated and stimulated wellbore section situated between 2519m - 2554m. When combined with reservoir and production analysis, it has been concluded that a larger and more advanced mechanical stimulation will greatly enhance natural gas production rates from the targeted interval.

The next phase of testing operations will now focus on establishing larger commercial gas production volumes from the Stage 2 testing interval.

While continuing testing of the second interval of the Miocene aged Gareji reservoir, situated between 2519m - 2554m, additional pressure pumping equipment is being mobilized to conduct a mechanical stimulation with 70 metric tons of proppant and improve well performance. The planned stimulation effort will utilize technology and scale in order to increase reservoir contact, improve near wellbore conductivity, and enhance gas production from all 100% of the perforated and stimulated Stage 2 testing section.

Based on the Netherland, Sewell & Associates resource estimate, the Gareji and the Maykop reservoirs of the Mtsare-Khevi Gas Complex are estimated to contain 5.8 Trillion Cubic Feet of recoverable gas, whereas the Gareji reservoir of Taribani complex contains 3.2 Trillion Cubic Feet of recoverable gas.

Zaza Mamulaishvili, President and Chief Executive Officer, commented:

"I am absolutely delighted to report about an early and potentially very material success at the second of the three testing intervals at Ud-2 well.

"We eagerly await next phase of a scaled up mechanical stimulation and post stimulation flow rate of the second testing interval but I believe the early results of the testing already both prove a material sustained deliverability of the Ud-2 well and provide significant confirmation as to the Block 12 potential of the Gareji reservoir, development of which will be transformational for the Company and Georgia's energy industry.

"I look forward to the results of the extended Ud-2 well test and to updating shareholders in due course."

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

Enquiries:

 
Frontera Resources           (713) 585- 3216 
Zaza Mamulaishvili 
[e-mail] 
 
  Cairn Financial Advisers 
  LLP                        [phone] 
Jo Turner / Liam Murray 
WH Ireland Limited           [phone] 
James Joyce / Alex Bond 
Yellow Jersey                [phone] 
Tim Thompson 
Harriet Jackson 
Henry Wilkinson 
 
 

Notes to Editors:

About Frontera Resources Corporation

Frontera Resources Corporation is an independent, international oil and gas exploration and production company whose strategy is to identify opportunities and operate in emerging markets in Eastern Europe around the Black Sea. Frontera Resources Corporation shares are traded on the London Stock Exchange, AIM Market - Symbol: FRR.

For more information, please visit  www.fronteraresources.com   . 

1. Information on Resource Estimates: The independent contingent and prospective resources estimates contained in this announcement were determined by the independent consulting firm of Netherland, Sewell & Associates (NSA) in accordance with the definitions and guidelines set forth in the 2007 Petroleum Resources Management System (PRMS) adopted by the Society of Petroleum Engineers (SPE). Dustin Aro, Frontera's Vice President, Well Completion and Stimulation, is the qualified person who reviewed and approved the technical information contained in this announcement on behalf of Frontera Resources. Mr. Aro has extensive experience in the oil and gas industry and holds a Bachelor of Science in Engineering and a Bachelor of Science in Business Administration from Michigan Technological University.

2. This release may contain certain forward-looking statements, including, without limitation, expectations, beliefs, plans and objectives regarding the transactions, work programs and other matters discussed in this release. Exploration for oil is a speculative business that involves a high degree of risk. Among the important factors that could cause actual results to differ materially from those indicated by such forward-looking statements are: risks inherent in oil and gas production operations; availability and performance of needed equipment and personnel; the Company's ability to raise capital to fund its exploration and development programs; seismic data; evaluation of logs, cores and other data from wells drilled; inherent uncertainty in estimation of oil and gas resources; fluctuations in oil and gas prices; weather conditions; general economic conditions; the political situation and relations with neighboring countries; and other factors listed in Frontera's financial reports, which are available at www.fronteraresources.com. There is no assurance that Frontera's expectations will be realized, and actual results may differ materially from those expressed in the forward-looking statements.

3. Glossary of Terms: BCF - means Billion Cubic Feet of gas. TCF - means Trillion Cubic Feet of gas. Mcf - means Thousand Cubic Feet of gas. OOIP - means Original Oil in Place. OGIP - means Gas in Place. Bopd - means Barrels of Oil Per Day. PPG - means pounds-per-gallon.

This information is provided by RNS

The company news service from the London Stock Exchange

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January 22, 2018 05:22 ET (10:22 GMT)