Oilex Ltd Cambay C-77H Re-frac Operations Update No4 & June 2022 Quarterly Report

Cambay C-77H Re-frac Operations Update No4

C-77H Re-frac Operations Update

The first of the two zones has been perforated and fracced. After the zone has been circulated clean, a bridge plug will be set in preparation for the second zone to be perforated and fracced.

June 2022 Quarterly Report

» During the Quarter a workover rig was mobilised to the C-77H wellsite on 20 June 2022 to prepare the well for the planned re-frac operation in July.

» Production continued on the Company’s Cambay gas field, together with gas sales, from the C-73 and C-77H wells.

» During the Quarter the Company continued to progress its Medway Hub Carbon Capture and Storage (“CCS”) project in the UK. The Company is preparing to apply for CCS licenses under the current NSTA 1st carbon storage licensing round.

» Subsequent to the end of the Quarter, the Company has been advised that its efforts to regain a participating interest and control of the West Kampar PSC in Indonesia have been unsuccessful. The Company understands the West Kampar PSC has been awarded to a third party. This marks the end of the Company’s activities in Indonesia.

» This Report is for the period 1 April 2022 to 30 June 2022 (the “Quarter”)

» Cash resources at 30 June 2022 were A$4.84 million (£2.74 million)

» Post Quarter end, a General Meeting of the Company was held on Wednesday, 13 July 2022 with all resolutions passed via a poll.

» During the Quarter the Company appointed Lisa Wynne as the new Company Secretary

» During the Quarter the Company arranged an equity capital raising, with existing and new sophisticated, institutional and other shareholders, led by Republic Investment Management Pte Ltd (“Republic”) and clients of Novum Securities Limited (“Novum”), of £2.5 million (approximately A$4.4 million) before expenses, through the issue, in tranches, of 1,250,000,000 new fully paid ordinary shares (“Placement Shares”) at £0.0020 (A$0.0035) per share (“Placement”).



Following a strategy review in 2021, Oilex Ltd (“Oilex” or the “Company”) is currently focused on developing its primary asset in the Cambay Basin, India, and applying to acquire mature gas producing assets and instigate CCS projects in the UK. The focus of the Company will be centred on gas production and CCS to become a carbon-neutral gas producer.

During the Quarter the Company was focused on restarting gas production cycling between two existing production wells in its Cambay PSC, the success of which was achieved and announced on 8 April 2022. Oilex’s acquisition of GSPC’s 55% PI in the Cambay PSC has enabled it to accelerate field development of the Cambay field’s c.930 BCF 2C gas resources (100% gross). Plans to re-frac the existing C-77H well are currently under way with preparatory civil works complete and all major services and equipment secured for the hydraulic fraccing operation, which is planned to commence in July 2022. Subject to the results of the re-fraccing operation, Oilex plans to demonstrate a reliable fraccing methodology for two new wells planned for calendar year 2023, subject to securing the necessary funding. Following the re-frac, the Company will seek to identify a new joint venture partner for the Cambay PSC to mitigate the funding requirement.

All work was undertaken safely, without environmental incident and in accordance with COVID-19 related protocols during the Quarter.

(Oilex: Operator and 100% interest)

The Cambay field development is centred on the successful exploitation of the gas resources held in the Eocene EP-IV reservoir which extends across the field and has been penetrated by over 30 wells. The EP-IV reservoir comprises low permeability (“tight”) siltstones and requires frac stimulation to provide economic gas production rates.

Whereas two horizontal wells (C-76H in 2011 and C-77H in 2014) were successfully and efficiently drilled to total depth in the EP-IV reservoir, the fraccing and completion of the wells were disappointing. In advance of drilling two new horizontal wells, the Company decided to re-frac the existing C-77H well to not only increase production but to also develop a reliable fraccing methodology that can be applied to future wells. C-77H had initial production levels of up to 1.0 mmscfd. The Company believes that a successful re-frac stimulation could potentially increase production levels by 3 to 5 times.

Well programs for two new horizontal wells (C-78H and C-79H) have been developed and the Company has engaged the Bedrock/Manan consortium for well management services for the C-77H re-frac (which is currently underway) and the execution of the two new wells which is planned, subject to securing the necessary funding, for calendar year 2023. Funding requirements may be mitigated by a successful farm out on the Cambay PSC.

Receipt of Outstanding Cash Calls

Oilex received a payment of US$154k from its previous Joint Venture partner resulting from reconciling final sale accounts with GSPC’s finance team in April 2022. Post the acquisition of 55% of the participating interest in the Cambay field, the Company does not anticipate any further receipts from its previous Joint Venture partner.

Cambay Well 77H Re-Frac

During the Quarter the Company announced that all major services and equipment were secured for the planned C-77H re-frac operation. The workover rig arrived on location at the C-77H wellsite on 20 June 2022 and was being rigged-up in preparation for pulling the completion string from the C-77H wellbore. In addition, civil works to prepare the wellsite for the re-fraccing operations have been completed, and all major services and equipment have been secured for the hydraulic fraccing operation. The re-fraccing operation is planned to commence in July 2022, and is anticipated to last 7 days.

The re-fraccing operation will be followed by flow-back and testing. The Company currently expects to be able to announce the results of the re-frac operation in August 2022.

Cambay Production Re-start Update

During the Quarter the Company announced after a lengthy shut-in of production on the Cambay field (PI 100%), gas production and sales were stabilised from one well (C-73) at circa 0.3 mmscfd, with circa 21 bopd of gas condensate.

Later in the Quarter, the Company announced production for the month of May on the Cambay field (PI 100%), averaging 0.24 mmscfd gas production and 18.5 BPD condensate production. The majority of the production has been from the C-73 well but production from the C-77H well has been intermittently co-mingled to provide a route to higher production levels. However, low pressure grid constraints have limited production rates to the current c.0.3 mmscfd level. The low pressure grid constraints are being addressed by the grid operator which will allow for higher production rates from the field. Towards the end of the Quarter, the C-77H well was taken off production in preparation for the re-fraccing operation.

Cambay Reserves Re-classification

During the Quarter the Company announced the following update with respect to the re-classification of Cambay gas and condensate volumes to reserves and increase in resources.


1. A review of Oilex’s net reserve and resource position in the Cambay PSC by an independent reserves auditor has resulted in the return of 206 BCF of gas and 8 million barrels of condensate to the 2P Reserves category from Contingent Resources.

2. Oilex’s participating interest in the reserves and resources has increased from 45% to 100% following its purchase of GSPC’s share of the project.

The revised reserve and resource position showing the re-allocation from Contingent Resource category to Reserves and the increase in volumes from the GSPC acquisition is shown in Tables 1 and 2:

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Qualified Petroleum Reserves and Resources Evaluator Statement

Pursuant to the requirements of Chapter 5 of the ASX Listing Rules, the information in this report relating to petroleum reserves and resources is based on and fairly represents information and supporting documentation prepared by or under the supervision of Mr Joe Salomon, Executive Chairman employed by Oilex Ltd. Mr Salomon has over 32 years experience in petroleum geology and is a member of the Society of Petroleum Engineers and AAPG. Mr Salomon meets the requirements of a qualified petroleum reserve and resource evaluator under Chapter 5 of the ASX Listing Rules and consents to the inclusion of this information in this report in the form and context in which it appears. Mr Salomon also meets the requirements of a qualified person under the AIM Note for Mining, Oil and Gas Companies, and consents to the inclusion of this information in this report in the form and context in which it appears.


Board of Directors

Roland Wessel, CEO and Executive Director

Colin Judd, CFO and Executive Director

Joe Salomon, Executive Chairman

Mark Bolton, Non-Executive Director

Paul Haywood, Independent Non-Executive Director

Peter Schwarz, Independent Non-Executive Director

Company Secretary

Lisa Wynne

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