REG - i3 Energy PLC - 2022 Canadian Capital Programme Update

I3 EnergyAnnouncement

11/02/2022 07:00

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RNS Number : 3653B  i3 Energy PLC  11 February 2022

11 February 2022

i3 Energy plc

("i3", "i3 Energy" or the "Company")

2022 Canadian Capital Programme Update

i3 Energy plc (AIM:I3E) (TSX:ITE), an independent oil and gas company with
assets and operations in the UK and Canada, is pleased to provide the
following operational update on its 2022 Canadian capital programme.

Highlights

Phase one of the Company's US$47 million 2022 Canadian Capital Budget is
designed to combine efficient low-risk development drilling with strategic
resource delineation and land capture. This includes development of the
Company's extensive Glauconitic fairway, expansion of its key Clearwater
position and demonstration of its prolific Simonette Montney resource. Phase
one of the Capital Budget is well-underway with:

·    Seven gross (five net) wells to be drilled across the Company's
diversified portfolio in Central Alberta (Mannville liquids-rich gas), Marten
Hills & Marten Creek (Clearwater oil) and Simonette (Montney oil),
collectively expected to add approximately 2,420 boepd (55% oil and Natural
Gas Liquids ("NGLs"))

·    A recompletion and reactivation campaign targeting low-cost,
high-return opportunities with less than one-year paybacks, estimated to add
initial production of 600 boepd (50% oil and NGLs)

·    Strategic field operations targeting improved opex, increased
netbacks, and the systematic reduction of greenhouse gas ("GHG") emissions

Majid Shafiq, CEO of i3 Energy plc, commented:

"We are very pleased to have successfully completed drilling operations on our
first new operated well in the Company's 2022 Canadian capital programme and
look forward to bringing this well and subsequent wells onto production over
the first half of this year. This is the initial phase of drilling operations,
and following evaluation of log and production data from these wells we will
embark upon phase two which will target an additional 10 to 13 locations."

Central Alberta - Open Creek

i3's first operated drill, targeting liquids-rich gas in the Glauconite
formation at 14-24-042-05W5, was completed on time and on budget. As part of
i3's 100% owned, two-well Glauconite programme, drilled off the same pad in
the Open Creek field of Central Alberta, the 14-24 well was drilled in 17 days
- spud to rig release - to a total measured depth ("TMD") of 5,334m with a
lateral length of 2,900m. As expected, the well encountered clean sand and
strong gas shows throughout the entirety of the horizontal length with
porosity averaging 9%. The rig has been skidded over on the same surface pad
to the 13-24-042-05W5 location, with intermediate casing already set and the
3,060m lateral section currently being drilled. Both wells are expected to be
completed, equipped and tied-in before the end of the first quarter with
anticipated initial production rates (at 30 days post production start-up) of
greater than 600 boepd per well (33% oil and NGLs) and will be produced
through i3's extensive network of existing infrastructure, specifically its
Leedale 09-21-043-04W5 gas plant, enabling low associated operating costs.
This two-well development pad is expected to pay out in less than one year and
to demonstrate the repeatability of i3's inventory of greater than 216 gross
(135 net) liquids-rich development locations in the Glauconite formation.

Clearwater Drilling and Appraisal

The Company is advancing its Marten Hills Clearwater development with a
non-operated four-well drilling programme (two net), which offsets i3's two
wells (one net) that were drilled and tied in last July (the 01-12 and
02-12-075-26W4 wells).  i3 owns a 50% working interest in the Clearwater
programme wells and has the option under the associated farm-in agreement,
previously announced on 5 May 2021, to participate in an additional three
wells, post this programme, which would see i3 earn 11.5 net sections of land
(circa 29.4 km(2)) in the Marten Hills, Cadotte and West Dawson areas of the
Clearwater play.

The first well, located at 12-13-075-26W4, is currently being drilled, with
the remaining three wells of the programme expected to be drilled off the same
pad in succession by early April. All laterals drilled to date have
encountered a clean 25m thick upper shoreface sandstone with porosities
ranging from 20% to 24%, and oil has been evidenced throughout via oil shows
on cuttings. The wells will be equipped and brought online sequentially and
concurrent with drilling operations throughout February and into April. These
wells are expected to add in aggregate 440 bopd (220 bopd net) and pay out in
approximately one year.

The Company continues to de-risk its expansive Clearwater acreage position in
Marten Creek, undertaking confirmatory recompletions targeting multiple
distinctive Clearwater intervals (individually averaging 11 meters of
thickness and 29% porosity) to characterize oil properties, further confirm
the extent of i3's mapped resource, and establish future development
strategies across i3's 78.6 net sections (circa 200 km(2)) in this core area.

Simonette

The 13-13-061-01W6 well (99% working interest) is the first i3 Energy operated
Lower Montney drill on its prolific Simonette position where the Company holds
an average 87.5% working interest in approximately 70 net sections (circa 178
km(2)) across the Company's North and South Simonette acreage positions. i3
spud the 13-13 well in South Simonette on February 4(th) and is currently
drilling at a depth of approximately 2,600m, with an estimated TMD of 6,300m
and a proposed 3,000m lateral section. 13-13 directly offsets the
102/15-13-061-01W6 Lower Montney well which was drilled in late 2018 by the
prior operator and delivered strong initial results with oil rates of greater
than 800 bopd. The 13-13 well will be completed using modern techniques,
consistent with area operators, that have proven to deliver consistently
strong results across the Montney fairway. Based on its successful
implementation at the offsetting 15-13 well, 13-13 will be equipped with
gas-lift to improve overall performance and to maintain consistent runtime.
The well will be tied in after spring thaw and is expected to come online this
summer at rates of greater than 1,000 boepd (70% oil and NGLs) with an
anticipated payout of 10 months from first production. This highly prospective
Montney Fairway provides an impactful growth engine for the Company, with
positive results from 13-13 expected to warrant additional capital allocation
and the transition to efficient multi-well pad development.

Recompletions and Operational Enhancements

The Company's operations group continues to identify low-cost, high-return
opportunities across i3's robust but historically undercapitalized inventory.
i3 is moving to bring on production from several recompletion and reactivation
candidates with associated deliverability upwards of 600 boepd net.  All such
identified projects have excellent economics and payback periods of less than
1 year.

i3 has also identified multiple pumping oil wells, which currently run off
propane or casing gas, as suitable electrification candidates. These projects
not only reduce operating costs but further i3's commitment to good oilfield
practices, including strong environmental stewardship in the form of reduced
GHG emissions from ongoing field operations.

Positioning to Capitalize on Commodity Strength

Early results from the abovementioned activities position i3 to achieve or
exceed its initial expectations. Should similar success continue, the Company
will look to accelerate its approved Capital Budget to take advantage of
operational momentum and the current favorable commodities environment.

Qualified Person's Statement

In accordance with the AIM Note for Mining and Oil and Gas Companies, i3
discloses that Majid Shafiq is the qualified person who has reviewed the
technical information contained in this announcement. He graduated with a
Master's degree in Petroleum Engineering from Heriot-Watt University in 1988
and is a member of the Society of Petroleum Engineers. Majid Shafiq consents
to the inclusion of the information in the form and context in which it
appears.

END

Enquiries:

 i3 Energy plc                                  c/o Camarco

 Majid Shafiq (CEO) / Graham Heath (CFO)        Tel: +44 (0) 203 781 8331

 WH Ireland Limited (Nomad and Joint Broker)

 James Joyce, Darshan Patel                     Tel: +44 (0) 207 220 1666

 Tennyson Securities (Joint Broker)

 Peter Krens                                    Tel: +44 (0) 207 186 9030

 Stifel Nicolaus Europe Limited (Joint Broker)

 Ashton Clanfield, Callum Stewart               Tel: +44 (0) 20 7710 7600

 Camarco

 Owen Roberts, James Crothers, Violet Wilson    Tel: +44 (0) 203 781 8331

 

 

Notes to Editors:

i3 Energy is an oil and gas Company with a low cost, diversified, growing
production base in Canada's most prolific hydrocarbon region, the Western
Canadian Sedimentary Basin and appraisal assets in the North Sea with
significant upside.

The Company is well positioned to deliver future growth through the
optimisation of its existing 100% owned asset base and the acquisition of long
life, low decline conventional production assets.

i3 is dedicated to responsible corporate practices and the environment, and
places high value on adhering to strong Environmental, Social and Governance
("ESG") practices.  i3 is proud of its performance to date as a responsible
steward of the environment, people, and capital management.  The Company is
committed to maintaining an ESG strategy, which has broader implications to
long-term value creation, as these benefits extend beyond regulatory
requirements.

i3 Energy is listed on the AIM market of the London Stock Exchange under the
symbol I3E and on the Toronto Stock Exchange under the symbol ITE. For further
information on i3 Energy please visit  https://i3.energy/
(https://i3.energy/) .

This announcement contains inside information.

 

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