Oilex Ltd Management Team (ASX:AIM:OEX) Q&A Update – shareholders questions

Share Talk asked investors for questions we could submit to the Oilex management team on the 12th of April 2022. Today we have received a reply.

The formate is the way we submitted your questions ( no particular order) with a reply next to each one, may we add the company answered every question we sent to them, thank you. Hopefully, you can see the Q you submitted – is answered.


Oilex Q&A 

• Refrac equip update – when starting? It is currently anticipated to be July 2022.

• How often are flow rates announced to the market? Regular updates on Cambay gas flow rates will be issued to the market so investors are up to date on-field performance.

• Date for next well to drill? Contingent on results of C-77H re-frac, the current expectation is Q4 2022 / Q1 2023.

• CCS licence update? We are waiting on the formal process to commence with NSTA, the regulator.

• CCS project economics – Revenue/NPV/timelines? TBA after the full FEED study is completed.

• JV this year? A formal Cambay farm-out process is expected to commence after the C-77H re-frac.

• What’s the current BOE from the Cambay field now it’s switched back on? TBA when production stabilises. We shall update the market in due course.

• What are total netbacks after royalties etc if any? There are no ORRs on Cambay, just GoI royalty.

• What’s the expected cost of the refrac operation? $1.8 million, subject to contract.

• What currency are gas sales being settled in? USD.

• What indication of flow can you give us from the Cambay well, just as a ballpark. TBA when production stabilises, but we would anticipate between 0.5 – 1 mmscfd.

• Will the refracking definitely begin in July? July is booked with service providers.

• Potentially, what revenues could CCS generate for the company? TBA after the full FEED study is completed.

• Can you give us a rough timeline for the development of CCS. We expect full FEED to commence after the CCS licence award; FEED will take c. 9 months. Commissioning would be anticipated 3 years after a Final Investment Decision – so perhaps by 2026?

• Are we likely to see director buys in Oilex? A Long Term Incentive Plan payable in shares is under development, subject to shareholder approval.

• Financially, what incentives are there out there to drive CCS that Oilex can access? There are various government grants but we are trying to proceed on a purely commercial basis. This will make the economics of the project very robust and not reliant on grants.

• Have we spoken with interested parties Regarding the development of Cambay? Yes, some farmees have shown interest.

• Do we plan more Acquisitions of more depleted fields for CCS? Yes, we are looking at opportunities in the UK

• I would be grateful for some technical details around the re-frac; incl. challenges to overcome; thoughts on flow rates; estimated percentage chance of success; what if re-frac fails; next steps if it does. The Eocene reservoir comprises much younger rocks than unconventional wells in the US and therefore requires a different fraccing method which has been studied extensively by the company. I estimate at a greater than 75% chance of success. If the re-frac is unsuccessful, we will have to review the future of Cambay – probably with a scaled-down field development.

• What would success look like on all fronts 12 months from now? A successful C-77H re-frac, a successful new (C-78H) well drilled and on production, a farmout agreement on Cambay, and the award of a CCS licence for the Medway Hub with FEED underway.

• What is the company’s view on Chance of Success (COS) on the refrac of C77H? Greater than 75%.

• How much is the refrac programme costing? C. $1.8 million, subject to contract.

• Are the company likely to have to raise further working capital, even with cash flow now being generated from gas/oil sales? Yes

• Are the board going to put some skin in the game? Understand options are being considered? As mentioned above, a Long Term Incentive Plan payable in shares is under development, subject to shareholder approval.

• When is the likelihood of the new well to be drilled? Quarter 3? In Q4 2022 / Q1 2023.

• What’s the difference between the new well to be drilled versus the existing well? An effective frac stimulation.

• How is the CCS project likely to be funded? Through a combination of both debt and equity.

• Is there access to government funding for the CCS project? There are various government grants but we are trying to proceed on a purely commercial basis. We are keen to ensure the project moves forward with robust economics.

Investor Enquiries

Oilex Ltd

Roland Wessel

Managing Director

Email: [email protected]

Tel: +61 8 9485 3200


Linking Shareholders and Executives :Share Talk

If anyone reads this article found it useful, helpful? Then please subscribe www.share-talk.com or follow SHARE TALK on our Twitter page for future updates. Terms of Website Use All information is provided on an as-is basis. Where we allow Bloggers to publish articles on our platform please note these are not our opinions or views and we have no affiliation with the companies mentioned

Weekly Newsletter

Sign up to receive exclusive stock market content in your inbox, once a week.

We don’t spam! Read our privacy policy for more info.