Oil & Gas Corporate News
Bowleven (LON:BLVN) (BUY, £5.50) (BLVN, 284.75p, ? 5.76%) announced that the Sapele-2 well drilling in the Douala Basin, offshore Cameroon has encountered a total of approximately 35 metres of independently log evaluated net hydrocarbon-bearing pay in the Omicron objectives. Based on conventional wireline logs, provisional net pay is independently estimated to be approximately 19 metres with an average porosity of 17% for the Lower Omicron and 16 metres with an average porosity of 17% for the Deep Omicron. In both intervals the GC tracer indicates the probable presence of oil however due to borehole conditions it was not feasible to recover reservoir fluid samples at this stage. Further detailed analysis, including test data, is now required to assess the implications of both the Sapele-2 and Sapele-1ST wells on current resource estimates. A testing programme is currently underway on Sapele-1ST and the results are expected in the next two to three weeks. An update on Sapele-2 testing is expected in the next three to four weeks.
Comment: The well has achieved the primary objective of intersecting the Lower and Deep Omicron intervals and the net pay appears to be greater than the 23 metres encountered in Sapele-1ST; average porosities appear to be similar. It is disappointing that the company did not recover fluid samples, but on balance an encouraging update. However, we await updates from the testing programme for both Sapele-1ST and Sapele-2, and highlight the company?s statement that: ?Due to the stratigraphic nature of the Omicron fields further drilling will likely be required to determine with greater confidence the potential size of these existing discoveries?.
Petroneft (LON:PTR) (PTR, 62p, ? 1.43%) reported its preliminary results for the year ended 31 December 2010. Operational highlights: Year-round production commenced on schedule in Q3 2010; Group 2P reserves increase 37% to 96.9 mmbbls; Production reached 3,100 bopd from 9 wells; Drilling of 17 additional production wells planned for 2011 underway; and five well exploration programme targeting 120 million barrels of reserves underway. Financial highlights: Commencement of oil sales in late Q3 2010; Capital expenditure of US$42 million in 2010; a fully-funded US$53 million spend planned for 2011; Successful oversubscribed US$43 million equity placing in October 2010; and Macquarie US$30 million Loan facility signed in May 2010, improved terms agreed in April 2011.
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