Oil and gas producer Block Energy (AIM:BLOE) is listing on AIM 11th June 2017 following an oversubscribed £5 million placing with institutional investors including Amati Global and Miton Group.
Share Talk has been talking with Paul Heywood, CEO Block Energy and we will update tomorrow.
With a Market Cap of £10.3 million on listing, Block believes it can be rapidly re-rated with its aggressive development strategy aimed at building the largest independent oil and gas producer in Georgia. The company has purchased two oilfields near Georgia’s capital, Tbilisi.
Block’s licences lie in the heart of Schlumberger’s 100% owned strategic position in the Kura basin, which at its peak produced ~70,000 barrels of oil per day (‘bopd’) in Georgia and is estimated to hold over 7 billion barrels of proven reserves in Azerbaijan and North Caucasus (Russia).
The short-term target is to raise production from 15 bopd to 900 bopd within 18 months via a low cost, low risk workover and sidetrack programme of existing wells, and then utilise cashflow to drill horizontal wells and sidetracks to rapidly raise production to c.2,000 bopd.
The Company is led by a team that has unrivalled experience and contacts in Georgia and the wider region and has one of the country’s leading oil services and drilling companies as a shareholder. Georgia is a low-cost, business-friendly nation with underdeveloped oil and gas reserves.
Block Energy, chaired by Gulf Keystone non-exec Philip Dimmock, says its potential resources in the Kura basin are worth $40 million (£29.9 million). It plans to produce 900 barrels of oil per day within 18 months.
Schlumberger, the blue-chip oil services company, owns neighbouring licences, which have already produced 200 million barrels of oil.
Block’s MD, Paul Haywood, said Schlumberger’s discovery ‘validates’ its own prospects.
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