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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Union Jack Oil Plc | LSE:UJO | London | Ordinary Share | GB00BLH1S316 | ORD 5P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.85 | 3.28% | 26.75 | 26.00 | 27.50 | 27.50 | 26.25 | 26.25 | 804,230 | 15:36:28 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| Oil And Gas Field Expl Svcs | 8.51M | 3.61M | 0.0320 | 8.36 | 30.15M |
From Apr 2019 to Apr 2024
TIDMUJO
RNS Number : 7620C
Union Jack Oil PLC
03 October 2018
3 October 2018
Market Abuse Regulation (MAR) Disclosure
Certain information contained in this announcement would have been deemed inside information for the purposes of Article 7 of Regulation (EU) No 596/2014 until the release of this announcement
Union Jack Oil plc
("Union Jack" or the "Company")
Proposed Farm-in for a 16.667% Interest in the Major West Newton Gas Discovery
Oversubscribed Placing and Subscription to raise GBP2.25 Million
The Directors of Union Jack Oil plc (AIM: UJO) are pleased to announce that the Company has agreed terms with Rathlin Energy (UK) Limited ("Rathlin"), a wholly owned subsidiary of Canadian registered Connaught Oil & Gas Ltd ("Connaught"), on a proposed farm-in for a 16.667% licence interest in PEDL183 ("Proposed Farm-in"). PEDL183 is located onshore UK in East Yorkshire and within the Western sector of the Southern Zechstein Basin and contains the significant West Newton A-1 gas discovery (Best Estimate Contingent Resource 189 Bcfe or 31.5 MMboe gross), where the drill-ready West Newton conventional appraisal well is planned to be drilled in Q1 2019.
Proposed Farm-in Highlights
-- Acquiring a 16.667% interest in the large 176,000 acre PEDL183 licence containing the significant West Newton A-1 UK onshore gas discovery
-- Attractive farm-in terms with no cash costs up front with all funding going towards drilling and licence costs
-- Best Estimate Contingent Resources of 189 Bcf of gas equivalent or 31.5 million barrels of oil equivalent (gross) assigned to West Newton in a Competent Persons Report
-- West Newton A-1 gas discovery is on-trend with the prolific offshore Hewett gas complex -- Proximity to existing gas pipelines and infrastructure
-- Drill-ready conventional appraisal well planned to be drilled in Q1 2019 to appraise the gas discovery
-- Compelling immediate and future economic value from a development of the gas discovery alone -- Operator's NPV10% of US$247 million and 52.5% ROR for the gas discovery alone
-- Attractive acquisition metrics of less than US$0.30 per barrel of oil equivalent for the gas discovery alone
-- Considerable upside potential from the lower Cadeby Reef oil exploration target underlying the gas reservoir that will also be drilled with Best Estimate Prospective Resources of 79.1 million boe (gross)
-- Further significant upside potential from other numerous prospects and leads
-- A successful appraisal well in Q1 2019 is expected to deliver a major onshore gas development
Fundraising and Commercial Partner Highlights
-- GBP2.25 million raised before expenses in an oversubscribed Fundraising to fund the Proposed Farm-in and associated well costs
-- Union Jack's Commercial Partner, Humber Oil & Gas Limited ("Humber"), has participated on identical terms in the Proposed Farm-in and will result in it also acquiring a 16.667% interest
-- Humber director has a beneficial interest in 13% of the pre-placing issued share capital of Union Jack held by G.P. (Jersey) Limited which has increased its shareholding to 15% of the Company's share capital as enlarged by the Fundraising
David Bramhill, Executive Chairman of Union Jack, commented:
"The Proposed Farm-in to PEDL183 containing the material West Newton gas discovery represents a significant project technically and is compelling financially for Union Jack and we are grateful for the continuing support of our existing shareholders and new investors who have participated in this oversubscribed fundraising".
"The funds raised will allow us to acquire a 16.667% interest in PEDL183 on attractive farm-in terms, and progress the drilling of the material West Newton conventional appraisal well, where success is expected to deliver a significant onshore gas development going forward and be transformational for Union Jack."
"We look forward to working with Rathlin and Humber, drilling the West Newton conventional appraisal well to firm up the project's significant potential and, upon a successful appraisal well, progress to a field development plan. Union Jack will book 5.3 million barrels of oil equivalent Contingent Resources to its existing reserve and resource portfolio on acquisition and once a field development plan is in place, West Newton's Contingent Resources can be converted to Reserves."
"Given our ongoing commitment to develop the Wressle oil discovery, and plans to commence drilling of the material Biscathorpe oil appraisal well during Q4 2018, the Proposed Farm-in and drilling of West Newton in Q1 2019 puts Union Jack in an even stronger position to deliver growth in reserves, production and asset value while adhering to our principles of strict financial and technical discipline."
Frazer Lang, Director of Humber and Union Jack's Commercial Partner, commented:
"PEDL183 is one of the largest onshore licences within the UK and we are delighted to be investing in parallel in this project alongside our Commercial Partner, Union Jack.
"The conventional West Newton appraisal well is planned to be drilled in Q1 2019 and, if successful, the effect will be transformational for both Union Jack and Humber.
"As Union Jack's Commercial Partner, I feel extremely positive about its future and I am also delighted to be beneficially interested in an increased 15% strategic equity investment in the enlarged issued share capital of Union Jack."
The Placing and Subscription
The Company has raised GBP2.25 million before expenses by way of a placing and subscription of 2,647,058,823 new ordinary shares of 0.025p each ("New Ordinary Shares") at a price of 0.085p per New Ordinary Share (the "Fundraising"). The placing comprises 2,474,117,652 New Ordinary Shares ("Placing") and the subscription of 172,941,171 New Ordinary Shares ("Subscription"). SP Angel Corporate Finance LLP acted as sole broker on the Placing.
Further information on PEDL183 and the Proposed Farm-in
Pursuant to the Proposed Farm-in, UJO has entered into a Heads of Agreement ("HOA") with Connaught, a private company incorporated in Canada and its wholly-owned subsidiary Rathlin, a private company incorporated in England and Wales whom are the Operator of PEDL183 ("Operator").
Union Jack will acquire a 16.667% interest in PEDL183 by paying 25% of the West Newton appraisal well cost, expected to be circa GBP4.6 million gross.
The transaction is subject to contract and regulatory approvals. The Company is not required to make any immediate up-front cash payment.
PEDL183 is located onshore UK in East Yorkshire and within the Western sector of the Southern Zechstein Basin and contains the major West Newton gas discovery and numerous other prospects and leads.
The West Newton gas discovery is on-trend with the prolific Hewett gasfield complex which had Original Gas in Place of 419 Bcf. Regionally, West Newton and Hewett are located in the Southern Permian Basin which contains approximately 24 Tcf of gas and 250 MMbbls of oil combined in production areas in Poland, Germany and the Netherlands.
The West Newton conventional appraisal well is defined from 3 Component 3D seismic. The West Newton conventional appraisal well is planned to be drilled in Q1 2019.
The West Newton A-1 gas discovery well was drilled and logged in 2014. Best Estimate Contingent resources are 189 Bcf of gas equivalent ("Bcfe") or 31.5 million barrels of oil equivalent ("boe") (gross). Reflecting its status as an existing gas discovery, the West Newton conventional appraisal well has a combined geological and commercial Probability of Success of 60%.
The Operator's estimated unrisked project economic evaluation indicates NPV10% before tax of US$247 million or $7.84 per boe and yields a 52.5% rate of return. Based on Union Jack's share of the drilling cost and the Operator's NPV10%, Union Jack is acquiring an interest in a gas discovery with Contingent Resources for less than $0.30 per boe.
Cadeby Reef Oil and Other Prospects
The Operator has identified a significant oil exploration target in the Cadeby Reef formation located below the existing discovered gas Contingent Resources. As part of the proposed West Newton appraisal well, the Cadeby Reef oil exploration target will also be drilled as a secondary target. The Cadeby Reef has Best Estimate Prospective Resources of 79.1 million boe (gross). The Cadeby Reef oil prospect has an estimated geological Chance of Success of 26%.
The Operator's estimated unrisked project economic evaluation indicates NPV10% before tax of US$850 million or US$10.75 per boe and yields a 104.8% rate of return. Based on Union Jack's share of the drilling cost and the Operator's estimated NPV10%, Union Jack is acquiring an interest in both a material gas discovery with Contingent Resources and an attractive oil target with Prospective Resources for a combined $0.08 per boe.
In addition, the Operator has also mapped a number of additional attractive prospects and leads on the licence that would add to the significant Prospective Resources mentioned previously.
Deloitte CPR
A Competent Person's Report dated 25 July 2017 was prepared for Connaught by Deloitte LLP, an independent petroleum engineering firm, that conforms to SPE-PRMS guidelines ("Deloitte CPR"). The Deloitte CPR incorporates data from a proprietary three component 3D seismic survey, acquired in 2014 following the drilling of the West Newton discovery well, and Deloitte has assigned Contingent Resources to the West Newton discovery.
In this announcement, all volumetric data disclosed under the Contingent Resource and Prospective Resource categories in relation to the West Newton gas discovery and PEDL183 have all been sourced from the Deloitte CPR.
The Executive Summary extracted from the Deloitte CPR will be available on the Union Jack website at www.unionjackoil.com
A glossary of technical terms is attached to this announcement.
Proposed West Newton Appraisal Well
The proposed West Newton appraisal well will involve conventional drilling to appraise the West Newton A-1 gas discovery within a Permian age Carbonate reservoir and a deeper secondary oil target and, for clarity, the operations at the site will not either now or in the future involve the process of hydraulic "fracking" for shale gas or shale-oil.
Commercial Partner Participation
Union Jack has an established relationship with Humber which forms the basis of an ongoing Commercial Partnership whereby both parties seek to co-invest in UK onshore hydrocarbon opportunities. The first such commercial collaboration was the acquisition of a combined 20% economic interest in PEDL253 containing the Biscathorpe-1 oil discovery where a conventional appraisal well Biscathorpe-2 is planned to be drilled Q4 2018. Humber's sole director, Frazer Lang, is also beneficially interested in 754,482,736 Ordinary Shares of the Company held by G.P. (Jersey) Limited representing 13% of the issued ordinary shares prior to the Fundraising.
The second such significant commercial collaboration between Union Jack and Humber is the Proposed Farm-in for a combined 33.3% economic interest in PEDL183, where Humber has also entered into a HOA on identical terms to that of Union Jack that will result in each of Union Jack and Humber acquiring a 16.667% interest.
In addition to the commercial collaboration between Humber and Union Jack, G.P. (Jersey) Limited has also acquired a further 513,123,802 New Ordinary Shares in the Fundraising and will hold in aggregate 1,267,606,538 Ordinary Shares representing a 15% interest in the Company's share capital as enlarged by the Fundraising.
Details of the Director Subscriptions
Joseph O'Farrell and Raymond Godson intend, following this announcement, to subscribe for a total of 47,058,822 New Ordinary Shares at a price of 0.085p per share ("Director Subscriptions").
Of this, Joseph O'Farrell, Executive Director of Union Jack, intends to subscribe GBP30,000 for 35,294,117 New Ordinary Shares, following which he will have a beneficial interest in 212,987,709 Ordinary Shares, representing approximately 2.52% in the Company's share capital as enlarged by the Fundraising.
Raymond Godson, Non-Executive Director of Union Jack, intends to subscribe GBP10,000 for 11,764,705 New Ordinary Shares, following which he will have a beneficial interest in 42,529,411 Ordinary Shares, representing approximately 0.05% in the Company's share capital as enlarged by the Fundraising.
Use of Proceeds
The net proceeds from the Fundraising will be used to fund the Company's drilling obligation on the West Newton conventional appraisal well in Q1 2019.
Fundraising and Admission
Completion of the Fundraising is conditional, inter alia, upon admission of the New Ordinary Shares to trading on AIM.
The New Ordinary Shares will rank pari passu in all respects with the existing ordinary shares. Application has been made to the London Stock Exchange for the New Ordinary Shares to be admitted to trading on AIM and admission is expected to take place on or around 8 October 2018.
Total Voting Rights
Following admission, the Company's share capital and total voting rights will comprise 8,450,710,254 Ordinary Shares. The Company does not hold any shares in treasury. Consequently, 8,450,710,254 is the figure which may be used by shareholders as the denominator for the calculation by which they will determine if they are required to notify their interest in, or a change to their interest in, the Company under the FCA's Disclosure and Transparency Rules.
Related Party Transactions
Humber is a substantial shareholder of the Company, and Joseph O'Farrell and Raymond Godson are directors of the Company. Therefore Humber, Joseph O'Farrell and Raymond Godson are related parties to Union Jack as defined in the AIM Rules for Companies. Humber's participation in the Fundraising, and the Director Subscriptions, are related party transactions for the purposes of Rule 13 the AIM Rules ("Related Party Transactions").
David Bramhill and Graham Bull, being the independent Directors for the purposes of the Related Party Transactions consider, having consulted with the Company's nominated adviser, SP Angel Corporate Finance LLP, that the terms and conditions of Humber's participation in the Placing and the Director Subscriptions are fair and reasonable insofar as the shareholders of the Company are concerned.
Presentation
Further details on PEDL183 and the West Newton gas discovery can be found in the "Rathlin Opportunity" presentation that is available on the Union Jack website at www.unionjackoil.com.
Competent Person's Statement
In accordance with the "AIM Rules - Note for Mining and Oil and Gas Companies", the information contained within the announcement has been reviewed and signed off by Graham Bull, Non-Executive Director, who has over 46 years of international oil and gas industry exploration experience.
For further information, please contact:
Union Jack Oil plc +44 (0)7787 160 682 David Bramhill SP Angel Corporate Finance LLP +44 (0)20 3470 0470 Nominated Adviser and Broker Lindsay Mair Richard Hail Allerton Communications 44 (0) 20 3633 1730 Media Enquiries Peter Curtain
Glossary of Oil and Gas Terms
(Extract from the Deloitte CPR)
The following glossary of terms is presented to assist the reader in understanding technical terms with which they may not be familiar. The glossary is intended to be general and not all terms may be present within this report. Definitions are from the 2011 SPE-PRMS guidelines.
Hot Features
Premium
1c Denotes low estimate scenario of Contingent Resources.
2C Denotes low estimate scenario of Contingent Resources.
--------------------------------------------------------------
3C Denotes high estimate scenario of Contingent
Resources. Accumulation
--------------------------------------------------------------
An individual body of naturally occurring petroleum
in a reservoir.
--------------------------------------------------------------
Aggregation The process of summing reservoir (or project)
level estimates of resource quantities to higher
levels or combinations such as field, country,
or company totals. Arithmetic summation of incremental
categories may yield different results from probabilistic
aggregation of distributions.
--------------------------------------------------------------
Approved for All necessary approvals have been obtained; capital
Development funds have been committeed, and implementation
of the development project is underway.
--------------------------------------------------------------
Analogous Reservoir Analogous reservoirs, as used in resources assessments,
have similar rock and fluid properties, reservoir
conditions (depth, temperature, and pressure)
and drive mechanisms, but are typically at a
more advanced stage of development than the reservoir
of interest and thus may provide concepts to
assist in the interpretation of more limited
data and estimation of recovery.
--------------------------------------------------------------
Assessment See Evaluation.
--------------------------------------------------------------
Associated Associated Gas is a natural gas found in contact
Gas with or dissolved in crude oil in thereservoir.
It can be further categorized as Gas-Cap Gas
or Solution Gas.
--------------------------------------------------------------
Barrels of See Crude Oil Equivalent.
Oil Equivalent
(Boe)
--------------------------------------------------------------
Best Estimate With respect to resource categorization, this
is considered to be the best estimate of the
quantity that will actually be recovered from
the accumulation by the project. It is the most
realistic assessment of recoverable quantities
if only a single result were reported. If probabilistic
methods are used, there should be at least a
50% probability (P50) that the quantities actually
recovered will equal or exceed the best estimate.
--------------------------------------------------------------
Chance Chance is 1- Risk. (See Risk.)
--------------------------------------------------------------
Commercial When a project is commercial, this implies that
the essential social, environmental, and economic
conditions are met, including political, legal,
regulatory, and contractual conditions. In addition,
a project is commercial if the degree of commitment
is such that the accumulation is expected to
be developed and placed on production within
a reasonable time frame. While 5 years is recommended
as a benchmark, a longer time frame could be
applied where, for example, development of economic
projects are deferred at the option of the producer
for, among other things, market-related reasons,
or to meet contractual or strategic objectives.
In all cases, the justification for classification
as Reserves should be clearly documented.
--------------------------------------------------------------
Committed Project Projects status where there is a demonstrated,
firm intention to develop and bring to production.
Intention may be demonstrated with funding/financial
plans and declaration of commerciality based
on realistic expectations of regulatory approvals
and reasonable satisfaction of other conditions
that would otherwise prevent the project from
being developed and brought to production.
--------------------------------------------------------------
Completion Completion of a well. The process by which a
well is brought to its final classification-
basically dry hole, producer, injector, or monitor
well. A dry hole is normally plugged and abandoned.
A well deemed to be producible of petroleum,
or used as an injector, is completed by establishing
a connection between the reservoir(s) and the
surface so that fluids can be produced from,
or injected into, the reservoir. Various methods
are utilized to establish this connection, but
they commonly involve the installation of some
combination of borehole equipment, casing and
tubing, and surface injection or production facilities.
--------------------------------------------------------------
Completion The specific reservoir interval(s) that is (are)
Interval open to the borehole and connected to the surface
facilities for production or injection, or reservoir
intervals open to the wellbore and each other
for injection purposes.
--------------------------------------------------------------
Concession A grant of access for a defined area and time
period that transfers certain entitlements to
produced hydrocarbons from the host country to
an enterprise. The enterprise is generally responsible
for exploration, development, production, and
sale of hydrocarbons that may be discovered.
Typically granted under a legislated fiscal system
where the host country collects taxes, fees,
and sometimes royalty on profits earned.
--------------------------------------------------------------
Condensate A mixture of hydrocarbons (mainly pentanes and
heavier) that exist in the gaseous phase at original
temperature and pressure of the reservoir, but
when produced, are in the liquid phase at surface
pressure and temperature conditions. Condensate
differs from natural gas liquids (NGL) in two
respects:
1) NGL is extracted and recovered in gas plants
rather than lease separators or other lease facilities;
and
2) NGL includes very light hydrocarbons (ethane,
propane, butanes) as well as the pentanes-plus
that are the main constituents of condensate.
Compare to Natural Gas Liquids (NGL)
--------------------------------------------------------------
Conditions The economic, marketing, legal, environmental,
social, and governmental factors forecast to
exist and impact the project during the time
period being evaluated (also termed Contingencies).
--------------------------------------------------------------
Contingency See Conditions.
--------------------------------------------------------------
Contingent Development and production of recoverable quantities
Project has not been committed due to conditions that
may or may not be fulfilled.
--------------------------------------------------------------
Contingent Those quantities of petroleum estimated, as of
Resources a given date, to be potentially recoverable from
known accumulations by application of development
projects but which are not currently considered
to be commercially recoverable due to one or
more contingencies. Contingent Resources are
a class of discovered recoverable resources.
--------------------------------------------------------------
Cost Recovery Under a typical production-sharing agreement,
the contractor is responsible for the field development
and all exploration and development expenses.
In return, the contractor recovers costs (investments
and operating expenses) out of the gross production
stream. The contractor normally receives payment
in oil production and is exposed to both technical
and market risks.
--------------------------------------------------------------
Crude Oil Petroleum that exists in the liquid phase in
natural underground reservoirs and remains liquid
at atmospheric conditions of pressure and temperature.
Crude Oil may include small amounts of nonhydrocarbons
produced with the liquids but does not include
liquids obtained from the processing of natural
gas.
--------------------------------------------------------------
Crude Oil Equivalent Conversion of gas volumes to their oil equivalent,
customarily done on the basis of the nominal
heating content or caloric value of the fuel.
Before aggregating, the gas volumes first must
be converted to the same temperature and pressure.
Common industry gas conversion factors usually
range between 1 barrel of oil equivalent (Boe)
= 5,600-6,000 standard cubic feet of gas. (Also
termed Barrels of Oil Equivalent.)
--------------------------------------------------------------
Cumulative The sum of production of oil and gas to date
Production (see also Production).
--------------------------------------------------------------
Current Economic Establishment of current economic conditions
Conditions should include relevant historical petroleum
prices and associated costs and may involve a
defined averaging period. The SPE guidelines
recommend that a one-year historical average
of costs and prices should be used as the default
basis of "constant case" resources estimates
and associated project cash flows.
--------------------------------------------------------------
Deposit Material that has accumulated due to a natural
process. In resource evaluations it identifies
an accumulation of hydrocarbons in a reservoir
(see Accumulation).
--------------------------------------------------------------
Deterministic The method of estimation of Reserves or Resources
Estimate is called deterministic if a discrete estimate(s)
is made based on known geoscience, engineering,
and economic data.
--------------------------------------------------------------
Developed Reserves Developed Reserves are expected to be recovered
from existing wells including reserves behind
pipe. Improved recovery reserves are considered
"Developed" only after the necessary equipment
has been installed, or when the costs to do so
are relatively minor compared to the cost of
a well.
Developed Reserves may be further subclassified
as Producing or Non- Producing.
--------------------------------------------------------------
Developed Producing Developed Producing Reserves are expected to
reserves be recovered from completion intervals that are
open and producing at the time of the estimate.
Improved recovery reserves are considered producing
only after the improved recovery project is in
operation.
--------------------------------------------------------------
Developed Non-producing Developed Non-Producing Reserves include shut-in
reserves and behind-pipe Reserves. Shut-in Reserves are
expected to be recovered from (1) completion
intervals that are open at the time of the estimate
but which have not yet started producing, (2)
wells that were shut in for market conditions
or pipeline connections, or (3) wells not capable
of production for mechanical reasons.
Behind- pipe Reserves are also those expected
to be recovered from zones in existing wells
that will require additional completion work
or future recompletion prior to start of production.
In all cases, production can be initiated or
restored with relatively low expenditure compared
to the cost of drilling a new well.
--------------------------------------------------------------
Development A discovered accumulation for which there are
not Viable no current plans to develop or to acquire additional
data at the time due to limited production potential.
A project maturity sub- class that reflects the
actions required to move a project toward commercial
production.
--------------------------------------------------------------
Development A discovered accumulation where project activities
Pending are ongoing to justify commercial development
in the foreseeable future. A project maturity
subclass that reflects the actions required to
move a project toward commercial production.
--------------------------------------------------------------
Development The design specifications, timing, and cost estimates
Place of the development project that can include,
but is not limited to, well locations, completion
techniques, drilling methods, processing facilities,
transportation and marketing. (See also Project.)
--------------------------------------------------------------
Development A discovered accumulation where project activities
Unclarified are on hold and/or where justification as a commercial
or on Hold development may be subject to significant delay.
A project maturity subclass that reflects the
actions required to move a project toward commercial
production.
--------------------------------------------------------------
Discovered A discovery is one petroleum accumulation, or
several petroleum accumulations collectively,
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. In this
context, "significant" implies that there is
evidence of a sufficient quantity of petroleum
to justify estimating the in-place volume demonstrated
by the well(s) and for evaluating the potential
for economic recovery. (See also Known Accumulations.)
--------------------------------------------------------------
Discovered Discovered Petroleum Initially-in-Place is that
Petroleum Initially-in-Place quantity of petroleum that is estimated, as of
a given date, to be contained in known accumulations
prior to production. Discovered Petroleum Initially-In-Place
may be subdivided into Commercial, Sub- Commercial,
and Unrecoverable, with the estimated commercially,
recoverable portion being classified as Reserves
and the estimated subcommercial recoverable portion
being classified as Contingent Resources.
--------------------------------------------------------------
Economic In relation to petroleum Reserves and Resources,
economic refers to the situation where the income
from an operation exceeds the expenses involved
in, or attributable to, that operation.
--------------------------------------------------------------
Economic Interest An Economic Interest is possessed in every case
in which an investor has acquired any Interest
in mineral in place and secures, by any form
of legal relationship, revenue derived from the
extraction of the mineral to which he must look
for a return of his capital.
--------------------------------------------------------------
Economic Limit Economic limit is defined as the production rate
beyond which the net operating cash flows (after
royalties or share of production owing to others)
from a project, which may be an individual well,
lease, or entire field, are negative.
--------------------------------------------------------------
Entitlement That portion of future production (and thus resources)
legally accruing to a
lessee or contractor under the terms of the development
and production contract with a lessor.
--------------------------------------------------------------
Entity A legal construct capable of bearing legal rights
and obligations. In resources evaluations this
typically refers to the lessee or contractor
which is some form of legal corporation (or consortium
of corporations). In a broader sense, an entity
can be an organization of any form and may include
governments or their agencies.
--------------------------------------------------------------
Estimated Ultimate Those quantities of petroleum that are estimated,
Recovery (EUR) on a given date, to be potentially recoverable
from an accumulation, plus those quantities already
produced therefrom.
--------------------------------------------------------------
Economic Limit Economic limit is defined as the production rate
beyond which the net operating cash flows (after
royalties or share of production owing to others)
from a project, which may be an individual well,
lease, or entire field, are negative.
--------------------------------------------------------------
Entitlement That portion of future production (and thus resources)
legally accruing to a lessee or contractor under
the terms of the development and production contract
with a lessor.
--------------------------------------------------------------
Entity A legal construct capable of bearing legal rights
and obligations. In resources evaluations this
typically refers to the lessee or contractor
which is some form of legal corporation (or consortium
of corporations). In a broader sense, an entity
can be an organization of any form and may include
governments or their agencies.
--------------------------------------------------------------
Estimated Ultimate Those quantities of petroleum that are estimated,
Recovery (EUR) on a given date, to be potentially recoverable
from an accumulation, plus those quantities already
produced therefrom.
--------------------------------------------------------------
Evaluation The geosciences, engineering, and associated
studies, including economic analyses, conducted
on a petroleum exploration, development, or producing
project resulting in estimates of the quantities
that can be recovered and sold and the associated
cash flow under defined forward conditions. Projects
are classified and estimates of derived quantities
are categorized according to applicable guidelines.
(Also termed Assessment.)
--------------------------------------------------------------
Evaluator The person or group of persons responsible for
performing an evaluation of a project. These
may be employees of the entities that have an
economic interest in the project or independent
consultants contracted for reviews and audits.
In all cases, the entity accepting the evaluation
takes responsibility for the results, including
Reserves and Resources and attributed value estimates.
--------------------------------------------------------------
Exploration Prospecting for undiscovered petroleum.
--------------------------------------------------------------
Field An area consisting of a single reservoir or multiple
reservoirs all grouped on, or related to, the
same individual geological structural feature
and/or stratigraphic condition. There may be
two or more reservoirs in a field that are separated
vertically by intervening impermeable rock, laterally
by local geologic barriers, or both. The term
may be defined differently by individual regulatory
authorities.
--------------------------------------------------------------
Flow Test An operation on a well designed to demonstrate
the existence of moveable petroleum in a reservoir
by establishing flow to the surface and/or to
provide an indication of the potential productivity
of that reservoir (such as a wireline formation
test).
--------------------------------------------------------------
Fluid Contact's The surface or interface in a reservoir separating
two regions characterized by predominant differences
in fluid saturations. Because of capillary and
other phenomena, fluid saturation change is not
necessarily abrupt or complete, nor is the surface
necessarily horizontal
--------------------------------------------------------------
Forecast Case Modifier applied to project resources estimates
and associated cash flow when such estimates
are based on those conditions (including costs
and product price schedules) forecast by the
evaluator to reasonably exist throughout the
life of the project. Inflation or deflation adjustments
are made to costs and revenues over the evaluation
period.
--------------------------------------------------------------
Fuel Gas See Lease Fuel.
--------------------------------------------------------------
Gas/Oil Ratio Gas to Oil Ratio (GOR) in an oil field, calculated
(GOR) using measured natural gas and crude oil volumes
at stated conditions. The gas/oil ratio may be
the solution gas/oil ration (Rs); produced gas/oil
ratio (Rp); or another suitably defined ratio
of gas production to oil production.
--------------------------------------------------------------
High Estimate With respect to resource categorization, this
(Resources) is considered to be an optimistic estimate of
the quantity that will actually be recovered
from an accumulation by a project. If probabilistic
methods are used, there should be at least a
10% probability (P10) that the quantities actually
recovered will equal or exceed the high estimate.
--------------------------------------------------------------
Hydrocarbons Chemical compounds consisting wholly of hydrogen
and carbon.
--------------------------------------------------------------
Justified for Implementation of the development project is
Development justified on the basis of reasonable forecast
commercial conditions at the time of reporting
and that there are reasonable expectations that
all necessary approvals/contracts will be obtained.
A project maturity subclass that reflects the
actions required to move a project toward commercial
production.
--------------------------------------------------------------
Kerogen Naturally occurring, solid, insoluble organic
material that occurs in source rocks and can
yield oil or gas upon subjection to heat and
pressure. Kerogen is also defined as the fraction
of large chemical aggregates in sedimentary organic
matter that is insoluble in solvents (in contrast,
the fraction that is soluble in organic solvents
is called natural bitumen). (See also Oil Shales.)
--------------------------------------------------------------
Known Accumulation An accumulation is an individual body of petroleum-in-place.
The key requirement to consider an accumulation
as "known," and hence containing Reserves or
Contingent Resources, is that it must have been
discovered, that is, penetrated by a well that
has established through testing, sampling, or
logging the existence of a significant quantity
of recoverable hydrocarbons.
--------------------------------------------------------------
Lead A project associated with a potential accumulation
that is currently poorly defined and requires
more data acquisition and/or evaluation in order
to be classified as a prospect. A project maturity
subclass that reflects the actions required to
move a project toward commercial production.
--------------------------------------------------------------
Low/Best/High The range of uncertainty reflects a reasonable
Estimates range of estimated potentially recoverable volumes
at varying degrees of uncertainty (using the
cumulative scenario approach) for an individual
accumulation or a project
--------------------------------------------------------------
Low Estimate With respect to resource categorization, this
is considered to be a conservative estimate of
the quantity that will actually be recovered
from the accumulation by a project. If probabilistic
methods are used, there should be at least a
90% probability (P90) that the quantities actually
recovered will equal or exceed the low estimate.
--------------------------------------------------------------
Marginal Contingent Known (discovered) accumulations for which a
Resources development project(s) has been evaluated as
economic or reasonably expected to become economic
but commitment is withheld because of one or
more contingencies (e.g., lack of market and/or
infrastructure).
--------------------------------------------------------------
Measurement The process of establishing quantity (volume
or mass) and quality of petroleum products delivered
to a reference point under conditions defined
by delivery contract or regulatory authorities.
--------------------------------------------------------------
Mineral Interest Mineral Interests in properties including (1)
a fee ownership or lease, concession, or other
interest representing the right to extract oil
or gas subject to such terms as may be imposed
by the conveyance of that interest; (2) royalty
interests, production payments payable in oil
or gas, and other non- operating interests in
properties operated by others; and (3) those
agreements with foreign governments or authorities
under which a reporting entity participates in
the operation of the related properties or otherwise
serves as producer of the underlying reserves
(as opposed to being an independent purchaser,
broker, dealer, or importer).
--------------------------------------------------------------
Monte Carlo A type of stochastic mathematical simulation
Stimulation that randomly and repeatedly samples input distributions
(e.g., reservoir properties) to generate a resulting
distribution (e.g., recoverable petroleum volumes).
--------------------------------------------------------------
Natural Gas Natural Gas is the portion of petroleum that
exists either in the gaseous phase or is in solution
in crude oil in natural underground reservoirs,
and which is gaseous at atmospheric conditions
of pressure and temperature. Natural Gas may
include some amount of nonhydrocarbons.
--------------------------------------------------------------
Natural Gas A mixture of light hydrocarbons that exist in
Liquids (NGL) the gaseous phase at reservoir conditions but
are recovered as liquids in gas processing plants.
NGL differs from condensate in two principal
respects: (1) NGL is extracted and recovered
in gas plants rather than lease separators or
other lease facilities; and (2) NGL includes
very light hydrocarbons (ethane, propane, butanes)
as well as the pentanes-plus (the main constituent
of condensates).
--------------------------------------------------------------
Natural Gas Natural gas liquids to gas ratio in an oil or
Liquids to gas field, calculated using measured natural
Gas Ratio gas liquids and gas volumes at stated conditions.
--------------------------------------------------------------
Net-back Linkage of input resource to the market price
of the refined products.
--------------------------------------------------------------
Net Profits An interest that receives a portion of the net
Interest proceeds from a well, typically after all costs
have been paid.
--------------------------------------------------------------
Net Working A company's working interest reduced by royalties
Interest or share of production owing to others under
applicable lease and fiscal terms. (Also called
Net Revenue Interest.)
--------------------------------------------------------------
Non-Associated Non-Associated Gas is a natural gas found in
Gas a natural reservoir that does not contain crude
oil.
--------------------------------------------------------------
Normal Production Production practices that involve flow of fluids
Practices through wells to surface facilities that involve
only physical separation of fluids and, if necessary,
solids. Wells can be stimulated, using techniques
including, but not limited to, hydraulic fracturing,
acidization, various other chemical treatments,
and thermal methods, and they can be artificially
lifted (e.g., with pumps or gas lift). Transportation
methods can include mixing with diluents to enable
flow, as well as conventional methods of compression
or pumping. Practices that involve chemical reforming
of molecules of the produced fluids are considered
manufacturing processes.
--------------------------------------------------------------
On Production The development project is currently producing
and selling petroleum to market. A project status/maturity
subclass that reflects the actions required to
move a project toward commercial production.
--------------------------------------------------------------
Operator The company or individual responsible for managing
an exploration, development, or production operation.
--------------------------------------------------------------
Penetration The intersection of a wellbore with a reservoir.
--------------------------------------------------------------
Petroleum Petroleum is defined as a naturally occurring
mixture consisting of hydrocarbons in the gaseous,
liquid, or solid phase. Petroleum may also contain
nonhydrocarbon compounds, common examples of
which are carbon dioxide, nitrogen, hydrogen
sulfide, and sulfur. In rare cases, nonhydrocarbon
content could be greater than 50%.
--------------------------------------------------------------
Petroleum Initially-in-Place Petroleum Initially-in-Place is the total quantity
of petroleum that is estimated to exist originally
in naturally occurring reservoirs. Crude Oil-in-place,
Natural Gas- in-place and Natural Bitumen-in-place
are defined in the same manner (see Resources).
(Also referred as Total Resource Base or Hydrocarbon
Endowment.)
--------------------------------------------------------------
Play A project associated with a prospective trend
of potential prospects, but which requires more
data acquisition and/or evaluation in order to
define specific leads or prospects. A project
maturity subclass that reflects the actions required
to move a project toward commercial production.
--------------------------------------------------------------
Pool An individual and separate accumulation of petroleum
in a reservoir.
--------------------------------------------------------------
Possible Reserves An incremental category of estimated recoverable
(P3) volumes associated with a defined degree of uncertainty.
Possible Reserves are those additional reserves
that analysis of geoscience and engineering data
suggest are less likely to be recoverable than
Probable Reserves. The total quantities ultimately
recovered from the project have a low probability
to exceed the sum of Proved plus Probable plus
Possible (3P), which is equivalent to the high
estimate scenario. When probabilistic methods
are used, there should be at least a 10% probability
that the actual quantities recovered will equal
or exceed the 3P estimate.
--------------------------------------------------------------
Primary Recovery Primary recovery is the extraction of petroleum
from reservoirs utilizing only the natural energy
available in the reservoirs to move fluids through
the reservoir rock to other points of recovery.
--------------------------------------------------------------
Probability The extent to which an event is likely to occur,
measured by the ratio of the favorable cases
to the whole number of cases possible. SPE convention
is to quote cumulative probability of exceeding
or equaling a quantity where P90 is the small
estimate and P10 is the large estimate. (See
also Uncertainty.)
--------------------------------------------------------------
Probabilistic The method of estimation of Resources is called
Estimate probabilistic when the known geoscience, engineering,
and economic data are used to generate a continuous
range of estimates and their associated probabilities.
--------------------------------------------------------------
Probable Reserves An incremental category of estimated recoverable
volumes associated with a defined degree of uncertainty.
Probable Reserves are those additional Reserves
that are less likely to be recovered than Proved
Reserves but more certain to be recovered than
Possible Reserves. It is equally likely that
actual remaining quantities recovered will be
greater than or less than the sum of the estimated
Proved plus Probable Reserves (2P). In this context,
when probabilistic methods are used, there should
be at least a 50% probability that the actual
quantities recovered will equal or exceed the
2P estimate.
--------------------------------------------------------------
Production Production is the cumulative quantity of petroleum
that has been actually recovered over a defined
time period. While all recoverable resource estimates
and production are reported in terms of the sales
product specifications, raw production quantities
(sales and nonsales, including nonhydrocarbons)
are also measured to support engineering analyses
requiring reservoir voidage calculations.
--------------------------------------------------------------
Production-Sharing In a production-sharing contract between a contractor
Contract and a host government, the contractor typically
bears all risk and costs for exploration, development,
and production. In return, if exploration is
successful, the contractor is given the opportunity
to recover the incurred investment from production,
subject to specific limits and terms. Ownership
is retained by the host government; however,
the contractor normally receives title to the
prescribed share of the volumes as they are produced
--------------------------------------------------------------
Profit Split Under a typical production-sharing agreement,
the contractor is responsible for the field development
and all exploration and development expenses.
In return, the contractor is entitled to a share
of the remaining profit oil or gas. The contractor
receives payment in oil or gas production and
is exposed to both technical and market risks.
--------------------------------------------------------------
Project Represents the link between the petroleum accumulation
and the decision- making process, including budget
allocation. A project may, for example, constitute
the development of a single reservoir or field,
or an incremental development in a producing
field, or the integrated development of a group
of several fields and associated facilities with
a common ownership. In general, an individual
project will represent a specific maturity level
at which a decision is made on whether or not
to proceed (i.e., spend money), and there should
be an associated range of estimated recoverable
resources for that project. (See also Development
Plan)
--------------------------------------------------------------
Property A volume of the Earth's crust wherein a corporate
entity or individual has contractual rights to
extract, process, and market a defined portion
of specified in-place minerals (including petroleum).
Defined in general as an area but may have depth
and/or stratigraphic constraints. May also be
termed a lease, concession, or license.
--------------------------------------------------------------
Prospect A project associated with a potential accumulation
that is sufficiently well defined to represent
a viable drilling target. A project maturity
sub-class that reflects the actions required
to move a project toward commercial production.
--------------------------------------------------------------
Prospective Those quantities of petroleum that are estimated,
Resources as of a given date, to be potentially recoverable
from undiscovered accumulations.
--------------------------------------------------------------
Proved Economic In many cases, external regulatory reporting
and/or financing requires that, even if only
the Proved Reserves estimate for the project
is actually recovered, the project will still
meet minimum economic criteria; the project is
then termed as "Proved Economic."
--------------------------------------------------------------
Proved Reserves An incremental category of estimated recoverable
volumes associated with a defined degree of uncertainty
Proved Reserves are those quantities of petroleum
which, by analysis of geoscience and engineering
data, can be estimated with reasonable certainty
to be commercially recoverable, from a given
date forward, from known reservoirs and underdefined
economic conditions, operating methods, and government
regulations. If deterministic methods are used,
the term reasonable certainty is intended to
express a high degree of confidence that the
quantities will be recovered. If probabilistic
methods are used, there should be at least a
90% probability that the quantities actually
recovered will equal or exceed the estimate.
Often referred
to as 1P, also as "Proven."
--------------------------------------------------------------
Purchase Contract A contract to purchase oil and gas provides the
right to purchase a specified volume of production
at an agreed price for a defined term.
--------------------------------------------------------------
Pure-Surface A pure-service contract is an agreement between
Contract a contractor and a host government that typically
covers a defined technical service to be provided
or completed during a specific period of time.
The service company investment is typically limited
to the value of equipment, tools, and expenses
for personnel used to perform the service. In
most cases, the service contractor's reimbursement
is fixed by the terms of the contract with little
exposure to either project performance or market
factors.
--------------------------------------------------------------
Range of Uncertainty The range of uncertainty of the recoverable and/or
potentially recoverable volumes may be represented
by either deterministic scenarios or by a probability
distribution. (See Resource Uncertainty Categories.)
--------------------------------------------------------------
Raw Natural Raw Natural Gas is natural gas as it is produced
Gas from the reservoir. It includes water vapor and
varying amounts of the heavier hydrocarbons that
may liquefy in lease facilities or gas plants
and may also contain sulfur compounds such as
hydrogen sulfide and other nonhydrocarbon gases
such as carbon dioxide, nitrogen, or helium,
but which, nevertheless, is exploitable for its
hydrocarbon content. Raw Natural Gas is often
not suitable for direct utilization by most types
of consumers.
--------------------------------------------------------------
Reasonable If deterministic methods for estimating recoverable
Certainty resource quantities are used, then reasonable
certainty is intended to express a high degree
of confidence that the estimated quantities will
be recovered.
--------------------------------------------------------------
Reasonable Indicates a high degree of confidence (low risk
Expectation of failure) that the project will proceed with
commercial development or the referenced event
will occur.
--------------------------------------------------------------
Reasonable Indicates a high degree of confidence in predictions
Forecast of future events and commercial conditions. The
basis of such forecasts includes, but is not
limited to, analysis of historical records and
published global economic models.
--------------------------------------------------------------
Recoverable Those quantities of hydrocarbons that are estimated
Resources to be producible from discovered or undiscovered
accumulations.
--------------------------------------------------------------
Recoverable A numeric expression of that portion of in- place
Efficiency quantities of petroleum estimated to be recoverable
by specific processes or projects, most often
represented as a percentage.
--------------------------------------------------------------
Reference Point A defined location within a petroleum extraction
and processing operation where quantities of
produced product are measured under defined conditions
prior to custody transfer (or consumption). Also
called Point of Sale or Custody Transfer Point.
--------------------------------------------------------------
Reserves Reserves are those quantities of petroleum anticipated
to be commercially recoverable by application
of development projects to known accumulations
from a given date forward under defined conditions.
Reserves must further satisfy four criteria:
They must be discovered, recoverable, commercial,
and remaining (as of a given date) based on the
development project(s) applied.
--------------------------------------------------------------
Reservoir A subsurface rock formation containing an individual
and separate natural accumulation of moveable
petroleum that is confined by impermeable rocks/formations
and is characterized by a single-pressure system.
--------------------------------------------------------------
Resources The term "resources" as used herein is intended
to encompass all quantities of petroleum (recoverable
and unrecoverable) naturally occurring on or
within the Earth's crust, discovered and undiscovered,
plus those quantities already produced. Further,
it includes all types of petroleum whether currently
considered "conventional" or "unconventional"
(see Total Petroleum Initially- in-Place). (In
basin potential studies, it may be referred to
as Total Resource Base or Hydrocarbon Endowment.)
--------------------------------------------------------------
Resources Categories Subdivisions of estimates of resources to be
recovered by a project(s) to indicate the associated
degrees of uncertainty. Categories reflect uncertainties
in the total petroleum remaining within the accumulation
(in- place resources), that portion of the in-
place petroleum that can be recovered by applying
a defined development project or projects, and
variations in the conditions that may impact
commercial development (e.g., market availability,
contractual changes)
--------------------------------------------------------------
Resources Classes Subdivisions of Resources that indicate the relative
maturity of the development projects being applied
to yield the recoverable quantity estimates.
Project maturity may be indicated qualitatively
by allocation to classes and subclasses and/or
quantitatively by associating a project's estimated
chance of reaching producing status.
--------------------------------------------------------------
Revenue-Sharing Revenue-sharing contracts are very similar to
Contract the production-sharing contracts described earlier,
with the exception of contractor payment. With
these contracts, the contractor usually receives
a defined share of revenue rather than a share
of the production.
--------------------------------------------------------------
Reversionary The right of future possession of an interest
Interest in a property when a specified condition has
been met.
--------------------------------------------------------------
Risk The probability of loss or failure. As "risk"
is generally associated with the negative outcome,
the term "chance" is preferred for general usage
to describe the probability of a discrete event
occurring.
--------------------------------------------------------------
Risk and Reward Risk and reward associated with oil and gas production
activities stems primarily from the variation
in revenues due to technical and economic risks.
Technical risk affects a company's ability to
physically extract and recover hydrocarbons and
is usually dependent on a number of technical
parameters. Economic risk is a function of the
success of a project and is critically dependent
on cost, price, and political or other economic
factors.
--------------------------------------------------------------
Risked-Serviced These agreements are very similar to the production-sharing
Contract agreements with the exception of contractor payment,
but risk is borne by the contractor. With a risked-
service contract, the contractor usually receives
a defined share of revenue rather than a share
of the production.
--------------------------------------------------------------
Royalty Royalty refers to payments that are due to the
host government or mineral owner (lessor) in
return for depletion of the reservoirs and the
producer (lessee/contractor) for having access
to the petroleum resources. Many agreements allow
for the producer to lift the royalty volumes,
sell them on behalf of the royalty owner, and
pay the proceeds to the owner. Some agreements
provide for the royalty to be taken only in kind
by the royalty owner.
--------------------------------------------------------------
Sales The quantity of petroleum product delivered at
the custody transfer (reference point) with specifications
and measurement conditions as defined in the
sales contract and/or by regulatory authorities.
All recoverable resources are estimated in terms
of the product sales quantity measurements.
--------------------------------------------------------------
Solution Gas Solution Gas is a natural gas that is dissolved
in crude oil in the reservoir at the prevailing
reservoir conditions of pressure and temperature.
It is a subset of Associated Gas.
--------------------------------------------------------------
Stochastic Adjective defining a process involving or containing
Estimate a random variable or variables or involving chance
or probability such as a stochastic stimulation
--------------------------------------------------------------
Subcommercial A project is subcommercial if the degree of commitment
is such that the accumulation is not expected
to be developed and placed on production within
a reasonable time frame. While 5 years is recommended
as a benchmark, a longer time frame could be
applied where, for example, development of economic
projects are deferred at the option of the producer
for, among other things, market-related reasons,
or to meet contractual or strategic objectives.
Discovered subcommercial projects are classified
as Contingent Resources.
--------------------------------------------------------------
Submarginal Known (discovered) accumulations for which evaluation
Contingent of development project(s) indicated they would
Resources not meet economic criteria, even considering
reasonably expected improvements in conditions.
--------------------------------------------------------------
Taxes Obligatory contributions to the public funds,
levied on persons, property, or income by governmental
authority.
--------------------------------------------------------------
Technical Uncertainty Indication of the varying degrees of uncertainty
in estimates of recoverable quantities influenced
by range of potential in-place hydrocarbon resources
within the reservoir and the range of the recovery
efficiency of the recovery project being applied.
--------------------------------------------------------------
Total Petroleum Total Petroleum Initially-in-Place is generally
Initially-in-Place accepted to be all those estimated quantities
of petroleum contained in the subsurface, as
well as those quantities already produced. This
was defined previously by the WPC as "Petroleum-in-place"
and has been termed "Resource Base" by others.
Also termed "Original-in-Place" or "Hydrocarbon
Endowment."
--------------------------------------------------------------
Uncertainty The range of possible outcomes in a series of
estimates. For recoverable resource assessments,
the range of uncertainty reflects a reasonable
range of estimated potentially recoverable quantities
for an individual accumulation or a project.
(See also Probability.)
--------------------------------------------------------------
Unconventional Petroleum accumulations that are pervasive throughout
Resources a large area and that are not significantly affected
by hydrodynamic influences (also referred to
as "continuous- type deposits"). Examples include
coalbed methane (CBM), basin-centered gas, shale
gas, gas hydrate, natural bitumen (tar sands),
and oil shale deposits. Typically, such accumulations
require specialized extraction technology (e.g.,
dewatering of CBM, massive fracturing programs
for shale gas, steam and/or solvents to mobilize
bitumen for in-situ recovery, and in some cases,
mining activities). Moreover, the extracted petroleum
may require significant processing prior to sale
(e.g., bitumen upgraders).
--------------------------------------------------------------
Undeveloped Undeveloped Reserves are quantities expected
Reserves to be recovered through future investments: (1)
from new wells on undrilled acreage in known
accumulations, (2) from deepening existing wells
to a different (but known) reservoir, (3) from
infill wells that will increase recovery, or
(4) where a relatively large expenditure (e.g.,
when compared to the cost of drilling a new well)
is required to (a) recomplete an existing well
or (b) install production or transportation facilities
for primary or improved recovery projects.
--------------------------------------------------------------
Unproved Reserves Unproved Reserves are based on geoscience and/or
engineering data similar to that used in estimates
of Proved Reserves, but technical or other uncertainties
preclude such reserves being classified as Proved.
Unproved Reserves may be further categorized
as Probable Reserves and Possible Reserves.
--------------------------------------------------------------
Unrecoverable That portion of Discovered or Undiscovered Petroleum
Resources Initially-in-Place quantities that are estimated,
as of a given date, not to be recoverable. A
portion of these quantities may become recoverable
in the future as commercial circumstances change,
technological developments occur, or additional
data are acquired.
--------------------------------------------------------------
Well Abandonment The permanent plugging of a dry hole, an injection
well, an exploration well or a well that no longer
produces petroleum or is no longer capable of
producing petroleum profitably. Several steps
are involved in the abandonment of a well: permission
for abandonment and procedural requirements are
secured from official agencies; the casing is
removed and salvaged if possible; and one or
more cement plugs and/or mud are placed in the
borehole to prevent migration of fluids between
the different formations penetrated by the borehole.
In some cases, wells may be temporarily abandoned
where operations are suspended for extended periods
pending future conversions to other applications
such as reservoir monitoring, enhanced recovery,
etc.
--------------------------------------------------------------
Wet Gas Wet (Rich) gas is natural gas from which no liquids
have been removed prior to the reference point.
The wet gas is accounted for in resource assessments,
and there is no separate accounting for contained
liquids. It should be recognized that this is
a resource assessment definition and not a phase
behavior definition.
--------------------------------------------------------------
Working Interest A company's equity interest in a project before
reduction for royalties or production share owed
to others under the applicable fiscal terms.
--------------------------------------------------------------
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.
END
MSCMTBRTMBMMBAP
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October 03, 2018 02:00 ET (06:00 GMT)
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