REG - Empyrean Energy PLC - Rig Mobilisation and Anticipated Spud Date

Empyrean EnergyAnnouncement

25/03/2022 07:45

For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20220325:nRSY0410Ga&default-theme=true

RNS Number : 0410G  Empyrean Energy PLC  25 March 2022

This announcement contains inside information

 

Empyrean Energy Plc / Index: AIM / Epic: EME / Sector: Oil & Gas

 

Empyrean Energy plc

 

Block 29/11, China - Rig Mobilisation and Anticipated Spud Date

 

25 March 2022

 

Empyrean Energy plc ("Empyrean" or the "Company"), the oil and gas development
company with interests in China, Indonesia and the United States, is pleased
to provide the following update on preparations to drill the Jade prospect at
its 100% owned Block 29/11 permit, offshore China:

 

HIGHLIGHTS

 

·      The China Oilfield Services Limited ("COSL") owned NH9 drill rig
for drilling of the Jade well is being handed over to Empyrean within the next
few days for safety checks

·      Mobilisation of the NH9 rig to the Jade well drilling location
expected to be on or around 27 March

·      The Jade well is currently anticipated to spud on or around 2
April

 

Empyrean is the operator of Block 29/11 in China and has 100% working interest
during the exploration phase. In the event of a commercial discovery, its
partner, China National Offshore Oil Company ("CNOOC"), may assume a 51%
participating interest in the development and production phase.

 

Following discussions with COSL and CNOOC to establish rig availability, the
recent completion of the well site survey and receipt of all required permits,
following the final well site survey report, Empyrean advises that the
mobilisation of the NH9 rig to the Jade well location is expected to occur on
or around 27 March. NH9 had been used to drill a well for  CNOOC immediately
preceding mobilisation to Jade.

 

COSL now estimate that the spud date for the Jade well will be on or around 2
April 2022, depending on prevailing weather conditions to ensure the safe
anchorage of the NH9 rig at the Jade location.

 

As previously advised, CNOOC EnerTech Drilling and Production Co ("CNOOC
EnerTech") are providing  comprehensive pre-drilling, drilling and testing
services to Empyrean for the Jade well. CNOOC EnerTech has a wealth of global
experience, but more importantly has vast local hands-on experience managing
the drilling of wells within the Pearl River Mouth Basin where the Block 29/11
permit sits. The Empyrean/ CNOOC EnerTech team will be present both onshore,
and offshore on the rig, during the drilling of Jade. Offshore, the team will
consist of a hand picked drilling supervisor, well site geologist, mud logger
and an electric logging expert. Gaz Bisht, Empyrean's technical director who
has a successful track record of hydrocarbon discoveries within offshore
China, has already made his way to China and is supervising the operations as
part of the onshore team.

 

Empyrean and the CNOOC EnerTech team have taken every precaution to plan for a
safe drilling campaign at Jade. The COSL owned NH9 rig and its drilling team
are 'drill fit' and the NH9 rig will be mobilised straight to the Jade well
location from its current position without the need to go back to port.

 

From the spud date, the Jade well is anticipated to take approximately 26 days
to drill to Total Depth on a trouble free basis. There are no overly
challenging drilling zones anticipated with the Jade well design and program.
If the Jade well intercepts a hydrocarbon zone, as anticipated, then testing
is planned to take approximately a further 2 weeks.

 

We will provide a further update on progress next week.

The Jade Prospect

The 2021 drilling campaign is targeting a world class conventional oil target
in the Jade Prospect, to which Gaffney Cline & Associates ("GCA") assigned
a Geological Chance of Success ("GCoS") of 32%. Subsequent to this independent
assessment, the Company completed a gas cloud study and post stack seismic
inversion study that it believes further mitigates risk and increases the GCoS
to 41%.

The Jade Prospect has a GCA audited mean in place potential of 225 MMbbl and a
P10 in place upside of 395 MMbbl. Four recent nearby discoveries by CNOOC
immediately to the West of the Jade Prospect are filled to their P10 potential
or better. All four CNOOC discoveries have gas clouds showing in the
overburden on seismic.

Empyrean's excellent quality 3D seismic indicates that there is a classic
"fill to spill" geological setup in the basin, and a robust regional seal,
that provides the Jade and Topaz Prospects with a very real possibility of
being filled in a similar fashion to nearby discoveries. The Jade and Topaz
prospects both have gas clouds, similar to nearby discoveries, in the
overburden on 3D seismic. Dry wells nearby do not have gas clouds. The Jade
Prospect is the first of the three identified prospects within Block 29/11,
which also contains the Topaz and Pearl prospects. The combined audited mean
in place potential of all three prospects is 884 MMbbl and a P10 in place
upside of 1,588 MMbbl. The post stack seismic inversion study showed Jade and
Topaz both have the potential for excellent carbonate buildup reservoir
quality with excellent porosity and permeability. Any oil discovered is
expected to be light oil in the 38-41 API range, similar to nearby
discoveries. These attributes combined with the potential for exceptional
natural reservoir drive supports the potential for excellent recovery rates.

The information contained in this announcement has been reviewed by Empyrean's
Executive Technical director, Gaz Bisht, who has over 31 years' experience as
a hydrocarbon geologist and geoscientist.

Empyrean CEO, Tom Kelly, stated:

"We are delighted that we are now days away from being ready to spud one of
the highest impact and exciting wells of 2022. Things are getting very real
for our team and we look forward to providing shareholders and investors with
further updates."

 

For further information please contact the following:

 

   Empyrean Energy plc
   Tom Kelly                                              Tel: +61 6146 5325

   Cenkos Securities plc (Nominated Advisor and Broker)
   Neil McDonald                                          Tel: +44 (0) 131 220 9771
   Pete Lynch                                             Tel: +44 (0) 131 220 9772

 

  First Equity Limited (Joint Broker)
   Jason Robertson                       Tel: +44 (0) 20 7330 1883

 

 

 

 

   First Equity Limited (Joint Broker)
   Jason Robertson                       Tel: +44 (0) 20 7330 1883

 

 

 

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
 or visit
www.rns.com (http://www.rns.com/)
.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
.   END  UPDUVOBRUAUOURR