Serica Energy (LON:SQZ)  is listed on Toronto and Aim, both with a ticker of SQZ (ISA-able). With shares of c. 177 million, it has a market cap at 38p : £67m. The website is www.serica-energy.com and the AGM presentation (June 2010) is here. Serica had a lot of bad luck with the drill bit in 2010. Starting the year with the share price around 55p, it drilled dry holes at Conan in the East Irish Sea and Oates in in Central North Sea, then found sub-commercial gas at Dambus and Marindan in the Kutai PSC in Indonesia, ending the year at about 42p. 

So what makes this unlucky oilie a good prospect for 2011? 


Assets (1) production

Indonesia - Kambuna Gas from the Kambuna field is delivered at Pangkalan Brandan at the site of a Pertamina gas plant and refinery about eight kilometres from the coast.

Serica sold 15% working interest to Salamander Energy in August 2008 and sold a further 25% to KrisEnergy in January 2010 retaining 25% interest in the TAC.

Gas sales from the Kambuna field commenced on 11 August 2009, using temporary processing facilities.  The permanent facilities were completed in October 2010 and the field is currently producing at an average of 43 mmscfd. In addition to the gas sales, up to 4,000 barrels per day of condensate is sold at a price close to that of crude oil.


Assets (2) development

North Sea: Columbus

In 2006 Serica drilled the Columbus discovery well  which tested and produced at a stabilised average rate of 17.5 million scfd and 1,060 bpd of 47.5° API condensate  The well was suspended for potential use in the development of the Columbus field. A further appraisal well and side-track were drilled in 2007 and also suspended for use in development.

The Columbus field is a combined structural and three way stratigraphic trap comprising Forties
sandstone reservoirs lying along a turbidite fairway. The reservoir thickness is c 131 vertical feet (40.0 metres) in well 23/16f-11 and c 70 vertical feet (21.0 metres) in the 23/16f-12z well. Reservoir quality is generally fair to good with porosities of up to 25% and averaging 20%. The overall field life is expected to be up to 14 years.

Getting to production has been slowed because…

Unlock the rest of this article with a 14 day trial

Already have an account?
Login here