PetroTal Corporation completed its first horizontal well and announced an initial four-day production rate of 6,200 barrels of oil per day.
It’s already spudded its second horizontal well and is aiming for production of 10,000 barrels of oil per day by the end of the year with 20,000 barrels of oil per day targeted by the end of 2020. Market cap is currently £116 million, which actually isn’t expensive at all if these objectives can be met.
Block Energy is another company drilling horizontal wells, but with rather less success. It announced an operations update and claimed to have successfully cemented casing at the 38z well. Completion of drilling operations is expected in around two weeks, so we should soon see whether they’ve been able to prevent fluid incursion, which comprised most of the claimed “production” at their previous well, 16z. Block plans to sidetrack three other wells, test one of the field’s gas discoveries, and drill a new gas well, so this does have potential, but it’s going to need to recover investor credibility.
UK Oil & Gas announced the commencement of its horizontal drilling operations. HH-2z aims to deliver a circa 3,200 ft horizontal section wholly within the Portland reservoir’s most oil productive zone. The well is expected to reach its total depth around mid-November and be producing by year end. I reckon it could be good for over 1,000 barrels a day.
88 Energy announced its quarterly report and confirmed that the Charlie-1 well is to be drilled and tested in the first quarter of 2020 using the already secured Nordic-Callista Rig-3. This is a big one: total gross mean prospective resources across the seven stacked targets to be intersected by Charlie-1 are 1.6 billion barrels of oil, 480 million barrels net to 88E. As the placing shares from last month clear, I would expect to see this move higher.
Finally, more nonsense with Anglo African Oil & Gas, who announced a non-binding indicative term sheet for an agreement which, if it were to complete and on bringing well TLP-103C into production, would provide up to 25 million dollars in offtake and prepayment financing. Unsurprisingly, their audience didn’t read beyond the headline, wrongly interpreted this as financing of the drill and got spiked. The financiers, Riverfort and YA II almost certainly will have been selling into this volume, but whether they can sell sufficient shares at a high enough price to finance the drill is another matter entirely.
Moving on, news from all the other companies who have made announcements so far this week will be covered in the Sunday blog and I’ll be back on Saturday with another podcast focussed on whatever interesting looking news comes out in the meantime.
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