REG - Empyrean Energy PLC - Second phase of exploration for Topaz Prospect

Empyrean EnergyAnnouncement

10/06/2022 07:00

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RNS Number : 4483O  Empyrean Energy PLC  10 June 2022

This announcement contains inside information

 

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

 

Empyrean Energy plc

 

Block 29/11, China - Decision to enter second phase of exploration for
drilling Topaz Prospect

 

10 June 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 the completion of post well analysis and
entering the second phase of exploration and drilling the Topaz prospect at
its 100% owned Block 29/11 permit, offshore China.

 

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. The second
phase of exploration requires the payment to CNOOC of US$250,000 and the work
obligation is the drilling of an exploration well within 2 years.

 

HIGHLIGHTS

 

·      Post-well analysis confirmed reservoir quality better than
pre-drill estimate with regional seal confirmed and depth conversion approach
validated

·      As a part of post-well evaluation, CNOOC geochemical and basin
modelling experts provided excellent assistance in interpreting the critical
elements of effective regional oil migration pathways-leading to positive
implications for the Topaz prospect

·      Based on post drill technical evaluation, and CNOOC-assisted
migration pathways assessment, Empyrean has decided to enter the second phase
of exploration and drill the Topaz prospect

 

Jade well results analysis:

 

Comprehensive post well analysis confirmed the Jade well carbonate reservoir
parameters are better than pre-drill estimates with total thickness of 292m
and porosity in the range of 25 to 27%. In addition, the Jade well penetrated
thick and effective regional seal facies and the reservoir top was encountered
within the depth conversion range. These parameters can now be more
confidently mapped across Empyrean's 3D data set.

 

As a result, reservoir, seal and trap validity of the Topaz prospect has been
enhanced by the Jade well data.

 

Key Elements of effective Migration pathways:

 

As a part of post-well evaluation, CNOOC geochemical and basin modelling
experts provided excellent assistance in assessing the critical elements of
effective regional oil migration pathways, leading to positive implications
for the Topaz prospect. Based on several oil discoveries in the area, CNOOC
has identified the following three key elements for effective regional oil
migration.

 

1.     A deep sag for oil generation

2.     A deep fault for efficient vertical migration that has reactivated
at the peak time of oil expulsion (10Ma)

3.     A carrier bed for lateral migration to the prospect

 

 

 

 

 

Implications for the Topaz Prospect:

 

Post-well evaluation indicates the Topaz prospect has the potential for oil
charge from two kitchen/source rocks - the more recently identified Baiyun
North Sag and the Baiyun East Sag that has been bio-marked as the proven
source rock for CNOOC light oil discoveries to the immediate West of Block
29/11 .

 

Baiyun North Sag is located within Block 29/11 immediately south and down dip
of the Topaz prospect and it has all three key elements required for
successful oil migration. It is a deep sag that is in the timing and depth
window for oil generation, and Empyrean has identified a suitable deep fault
for efficient vertical migration that  reactivated at the peak time of oil
expulsion approximately 10 million years ago (10Ma). Finally, a thick carrier
bed exists for lateral migration to the Topaz prospect. This carrier bed has
been confirmed during the drilling of the Jade well and is mapped on
Empyrean's 3D data set.

 

At the same time, the gas shows within the "gas cloud" zone in the overburden
at the Jade well are now interpreted to have migrated from Baiyun North Sag
via reactivation of a nearby fault, approximately 800m away rather than coming
from basinal faults extending into Baiyun East Sag which is approximately 20km
away. The identification of this nearby fault that extends into the Baiyun
North Sag is now the most likely explanation for the gas shows in the Jade
well. This interpretation enhances the prospects of Baiyun North Sag as a
potentially valid additional source rock and, in turn, the likelihood of the
Topaz prospect having access to two mature source rocks/kitchens.

 

Additionally, a CNOOC regional migration map indicates that Topaz has
potential for being charged from the proven Baiyun East Sag via spill from the
CNOOC discovery well LH 23-1d.

The information contained in this announcement has been reviewed by Empyrean's
Executive Technical director, Gaz Bisht, who has over 32 years' experience as
a hydrocarbon geologist and geoscientist.

Empyrean CEO, Tom Kelly, stated:

"Being able to combine our excellent quality 3D seismic data with the
confirmed well data and post well analysis  has improved the validity of the
Topaz prospect as a robust and large drilling target of approximately 891
million barrels in place (P10). Empyrean looks forward to maximising the value
from its interest in the Mako Gas Field and positioning to drill the exciting
Topaz prospect. Empyrean has also started to assess a number of additional oil
and gas projects that it believes may enhance a balanced portfolio of
opportunity and will update shareholders as required".

 

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) 20 7297 8900
 Pete Lynch
 Pearl Kellie

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

 

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