REG - Caspian Sunrise plc - Operational, financial and shareholding update

Caspian SunriseAnnouncement

22/12/2021 07:00

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RNS Number : 4054W  Caspian Sunrise plc  22 December 2021

Caspian Sunrise PLC

("Caspian Sunrise" or the "Company")

 

Operational, financial and shareholding update

 

The Board of Caspian Sunrise is pleased to provide the following update:

 

BNG Shallow Wells

 

MJF Structure

We are pleased to report that our latest well on the MJF structure, Well 153,
has commenced production at the rate of approximately 830 bopd, using a 8.5mm
choke.  As with Well 154, which continues to produce at the rate of
approximately 600 bopd, Well 153 was drilled as a horizontal well.

 

The additional production from Well 153 has increased overall production
levels to approximately 2,300 bopd.

 

The next new well to be drilled on the MJF structure will be Well 152, again
to be drilled as a horizontal well. We are also re-drilling existing wells on
the MJF structure on a horizontal basis, with existing Well 142 the next to
receive a 600 meter horizontal side-track.

 

South Yelemes

We have been informed that all the supporting documentation required for the
upgrade to export status have been approved and the upgrade will be granted on
the Minister's signature.  Once received, this will allow the existing wells
on the structure to be reopened with an expected 300 bopd addition to
production volumes, the majority of which can be sold on the export market.
Additionally, we plan to drill a new horizontal well on the structure
targeting oil in the shallow Dolomite.

 

The South Yelemes licence upgrade should also allow us to add to our proven
reserves.

 

Deep Wells

 

A8

Deep Well A8 has been drilled and logged to a depth of 5,450 meters without
incident. Three potential oil bearing intervals covering, in aggregate,
approximately 140 meters have been identified, with an initial 5 meter section
already perforated. We expect to have results of this perforation shortly to
announce.

 

Work to progress existing deep wells A5, A6 and 801 remains on hold.

 

Further deep wells

In compliance with our existing work programme obligations a new deep well on
the Airshagyl structure, Deep Well A7, is set to be spudded before the end of
the month. The well has a planned Total Depth of 5,300 meters and is targeting
oil in the Carboniferous and Devonian.  Drilling is expected to take
approximately 4 months.

 

A further deep well on the Yelemes Deep structure, Deep Well 802, is also
planned to be spudded early next year, with a planned Total Depth of 5,300
meters and is also targeting oil in the Carboniferous and Devonian. Drilling
is also expected to take approximately 4 months once spudded.

 

These wells will be drilled using the Group's own rigs.  The casing for Deep
Well A7 and 802 has already been acquired and accordingly the remaining cash
costs for both these wells are expected to be much lower than for any deep
wells drilled to date.

 

These are the final two deep wells required under the BNG work programme. Once
completed any further deep wells will be drilled on a discretionary basis.

 

Cashflows

The current relatively high oil price has transformed the Group's financial
position compared to that in 2020.

 

Deep Wells A7 and 802 are the final deep wells required to be drilled under
the terms of the BNG licence. Once completed and provided the oil price
continues at existing levels the board expects the cashflows from operational
activities to improve significantly.

 

Debt Conversion

Work is progressing with the various regulatory bodies required to implement
the proposed debt conversion announced earlier this year. A circular convening
a general meeting to consider the required shareholder resolutions will be
issued in due course.

 

Extension of option exercise period

The Board, other than Clive Carver who was recused, has agreed to extend the
exercise date for his existing options over 2.4 million shares  from 14
December 2021 to 14 December 2023.

 

Comment

 

Clive Carver, non-executive chairman said

 

"We continue to make good progress developing the proven shallow structures at
the BNG Contract Area, which with the continuing relatively strong
international oil price is providing the funding to allow the completion of
the deep well programme required under the BNG work programme.

 

 

Production volumes form the shallow structures are expected to increase in the
near future as the export licence is received for the shallow South Yelemes
structure and we continue to redrill existing wells using the horizontal
techniques that are proving so successful.

 

We also look forward to the results from the perforation at Deep Well A8."

 

 

Contacts:

 

Caspian Sunrise PLC

 

Clive Carver

Chairman
+7 727 375 0202

 

WH Ireland, Nominated Adviser & Broker

 

James
Joyce
+44 (0) 207 220 1666

Andrew de Andrade

 

Qualified person

 

Mr. Assylbek Umbetov, a member Association of Petroleum Engineers, has
reviewed and approved the technical disclosures in this announcement.

 

This announcement has been posted to:

www.caspiansunrise.com/investors (http://www.caspiansunrise.com/investors)

 

The information contained within this announcement is deemed by the Company to
constitute inside information under the Market Abuse Regulation (EU) No.
596/2014.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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