REG - Mosman Oil & Gas - USA Production & Development Update

Mosman Oil and GasAnnouncement

11/08/2023 09:30

For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20230811:nRSK0852Ja&default-theme=true

RNS Number : 0852J  Mosman Oil and Gas Limited  11 August 2023

11 August 2023

Mosman Oil and Gas Limited

("Mosman" or the "Company")

 

USA Production & Development Update

 

Mosman Oil and Gas Limited (AIM: MSMN) the oil and gas exploration,
development, and production company, announces its production for the year
ended 30 June 2023 ("FY23"), and an update on development in the USA.

 

Production

 

·      FY23 Net Production of 31,067 boe (FY22: 37,915 boe). 2023 was
impacted by the halt in production at Falcon due to water ingress. Whilst
there is remaining potential at Falcon, the lower gas prices meant a workover
is not a high-ranking investment alternative.

·     Achieved 73% annual increase in production at Stanley with
installation of gas lift and jet pumps.

·      Production for the June 2023 quarter was 15,332 boe gross and
5,937 boe net. Production was materially lower than the March quarter (28,632
boe gross, 11,960 boe net) mainly due to issues at Cinnabar as well as
increased sand production issues requiring additional screens and clean outs
at Stanley. Some wells may be optimised by changing back to gas lift.

·      Work continues at the Cinnabar project to optimise production on
all three existing wells on the lease and planning for drilling the next
development well (that is subject to funding). At G-2, the well has been
serviced and a fracture stimulation is expected to be conducted in the week
commencing 13 August 2023.

 

John W Barr, Chairman, said: "The Company continues to develop and maintain
its portfolio of projects, with a clear focus on its strategic plan to
maximise the opportunity for further production growth and increasing
cashflow. Whilst we are disappointed with the outcome at Falcon, the
resolution of sand issues at Stanley and currently happening workovers at
Cinnabar may deliver a more sustainable growth in production."

 

USA Production

 

Net Production attributable to Mosman for the year ended 30 June 2023 was
31,067 boe. The decrease was primarily due to the production halting at
Falcon, which was somewhat offset by increased production at Stanley and new
production at Cinnabar.

 

Production Summary
 

             Gross Project  Net Production to  Gross Project  Net Production to

             Production     Mosman             Production     Mosman
 Falcon      -              -                  29,114         21,836
 Stanley     44,915         16,844             26,212         9,746
 Cinnabar    8,465          6,349              -              -
 Livingston  2,654          531                1,530          306
 Winters     22,733         5,304              14,726         3,456
 Arkoma      8,166          2,039              10,294         2,571
 Total       86,933         31,067             81,876         37,915

The Net Production of 31,067 boe produced in the FY23 consisted of 21,503
barrels of oil and 55,474 MMBtu of gas.

 

For the June quarter, net production was 5,937 boe and consisted of 4,845
barrels of oil and 6,331 MMBtu of gas. The average sale prices achieved during
the June 2023 quarter was US$73.02 per barrel for oil and US$1.70 per MMBtu
for gas. (March quarter was US$73.46 and US$3.49) (in each case after
transport and processing costs but before royalties).

 

 

             Gross Production  Net Production to Mosman  Gross Production  Net Production to Mosman
 Stanley     9,949             3,744                     13,753            5,028
 Cinnabar    1,775             1,332                     6,690             5,017
 Livingston  350               70                        535               107
 Winters     1,334             311                       6,324             1,476
 Arkoma      1,924             480                       1,330             332
 Total       15,332            5,937                     28,632            11,960

 
Stanley (34.85% to 38.5% Working Interests)
 

Whilst production at Stanley was lower in the quarter, annual production
increased 73%.

 

Jet pumps were installed on three wells that increased production, however
that also increased operating costs and sand production. The optimal
production method for each well is being reviewed and it may be that some
wells are returned to gas lift.

 

A seismic mapping project has recently been completed detailing significant
remaining potential in the Stanley leases.

 

Winters-2 continues to produce both gas and oil with the help of gas lift.

 

Cinnabar Project (75% Working Interest)

 

At Cinnabar, production was down as advised. Mosman has completed a detailed
development plan for the lease which now in theory has three wells with the
ability to produce, and each well has produced some oil which is included in
the quarterly numbers of gross 1,775 boe. The plan is gradually being
implemented with recently installed gas infrastructure currently being used to
enable gas lift, and work continues to optimise production on the three
existing wells, including the frac of one zone at Cinnabar-2 which is planned
in the week commencing 13 August 2023.

 

Production numbers are based on the current best available data and are
subject to adjustment upon receipt of final sales invoices from the purchasers
of products.

 

Cash position

 

At 31 July 2023, Mosman had cash at bank of circa AU$0.8 million.

 

Funds raised in the July and April placings have been and continue to be
expended as follows:

1.  Mosman's share of the connection fee to connect the Cinnabar Project gas
flowline;

2.  Costs associated with the Corporate Review;

3.  Applications, documentation, and fees related to approvals for seismic
acquisition in EP 145 as well as management activities including soil and
water sampling for hydrogen and helium and Central Land Council annual fees;

4.  Additional investment at Cinnabar to provide gas lift to optimise
production at existing wells;

5.  Additional costs of workovers and stimulation to optimise production at
Cinnabar wells; and

6.  Expenditure related to the new lease area near Cinnabar including lease
costs and technical work to identify preferred drilling locations.

 

Market Abuse Regulation (MAR) Disclosure

The information contained within this announcement is deemed by the Company to
constitute inside information as stipulated under the Market Abuse Regulations
(EU) No. 596/2014 ('MAR') which has been incorporated into UK law by the
European Union (Withdrawal) Act 2018. Upon the publication of this
announcement via Regulatory Information Service ('RIS'), this information is
now considered to be in the public domain.

 

Enquiries:

 

 Mosman Oil & Gas Limited                                             NOMAD and Joint Broker

 John W Barr, Executive Chairman Andy Carroll, Technical Director     SP Angel Corporate Finance LLP
 jwbarr@mosmanoilandgas.com (mailto:jwbarr@mosmanoilandgas.com)

 acarroll@mosmanoilandgas.com (mailto:acarroll@mosmanoilandgas.com)   Stuart Gledhill / Richard Hail / Adam Cowl

                                                                      +44 (0) 20 3470 0470
 Alma PR                                                              Joint Broker

 Justine James                                                        CMC Markets UK Plc

 +44 (0) 20 3405 0205                                                 Douglas Crippen

 +44 (0) 7525 324431                                                  +44 (0) 020 3003 8632

 mosman@almapr.co.uk (mailto:mosman@almapr.co.uk)

 

Updates on the Company's activities are regularly posted on its website:

www.mosmanoilandgas.com (http://www.mosmanoilandgas.com/)

 

 

Notes to editors

Mosman (AIM: MSMN) is an oil exploration, development, and production company
with projects in the US and Australia. Mosman's strategic objectives remain
consistent: to identify opportunities which will provide operating cash flow
and have development upside, in conjunction with progressing exploration of
its existing exploration permit and permit application. The Company has
several projects in the US. In addition to exploration projects in the Amadeus
Basin in Central Australia.

 

Glossary:
 boe                       Barrels of oil equivalent based on calorific value as opposed to dollar value
 boepd                     Barrels of oil per day of oil equivalent based on calorific value as opposed
                           to dollar value
 bopd                      Barrels of oil per day
 Gross Project Production  Means the production of BOE at a total project level (100% basis) before
                           royalties (where Mosman

                           is the Operator) and where Mosman is not the operator the total gross
                           production for the project
 Mcf                       Thousand cubic feet
 Mcfpd                     Thousand cubic feet per day
 MBtu                      One thousand British Thermal Units
 MBtupd                    One thousand British Thermal Units per day
 MMBtu                     One million British Thermal Units
 MMBtupd                   One million British Thermal Units per day
 Net Production            Net to Mosman's Working Interest; Net Production attributable to Mosman means
                           net to Mosman's

                           Working Interest before royalties

 

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  UPDUAAWROBUWARR