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RRR - Red Rock Resources News Story

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Basic Materials
Size
Micro Cap
Market Cap £10.7m
Enterprise Value £10.8m
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Position in Universe 1598th / 1826

Red Rock Resources - Shoats Creek Operations Update

Thu 14th July, 2016 9:00am
RNS Number : 1317E
Red Rock Resources plc
14 July 2016

Red Rock Resources plc

("Red Rock" or the "Company")

Shoats Creek Operations Update

14 July 2016

Red Rock Resources Plc ("Red Rock" or the "Company"), the natural resource investment and development company, announces the following developments have been undertaken at the Shoats Creek Field:

Highlights:

Lutcher Moore #20 ("LM20") now producing 100 barrels of oil per day ("BOPD") from the Frio formation - 20 BOPD net to Red Rock

Recompletion of the Lutcher Moore #19 Well ("LM19") as a Frio producer now finished with well testing in progress

Work on preparing the Lutcher More 21 ("LM21") for spud continues with a firm date to be announced in due course

Lutcher More #15 ("LM15") passed a mechanical integrity test and can now be used for all on-site disposal of Shoats Creek salt water volumes

Additional development opportunities have been identified in the field and a plan to begin and expand natural gas production and sales is in progress

Red Rock Chairman Andrew Bell states: "We continue field expansion with the low-cost LM19 recompletion now nearly ready for fulltime production. The operator continues to work to firm the spud date for the LM21 and several additional recompletions have been identified for further development along with a plan to add natural gas production via a local partnership in the area.

While development over the year has ended up being focussed more on cheaper recompletions than on new wells we expect production levels to continue to increase and meet out ultimate targets for the year. Shoats Creek continues to offer a variety of cost-effective development pathways to increased onshore US oil and gas production."

Lutcher Moore #19

As previously announced on 8 June 2016, the LM19 well has now been recompleted as a Frio producing well following a successful squeeze job at the 5030' level. The well was originally a production well in a deeper horizon, the Cockfield, and following internal analysis offered itself as a logical candidate to produce in the Frio.

In excess of 400 BBls of oil were recovered during initial operations, swabbing and testing, with a three-day average of approximately 40 barrels of oil per day under natural pressure. The oil cut in the LM19 is over 50% better than that achieved by the Lutcher More 20 well ("LM20") and the recovered volumes, thickness of payzone, and high oil cut gives the partners enhanced confidence in the quality of the Frio sands in this section of the field. The LM19 will be added to full production in due course.

Red Rock will have a 20% WI and 14.4% NRI in the well, and the Company's contribution to the well will be approximately $8k.

Lutcher Moore #21

Preparation for the LM 21 spud continues, where Red Rock will have a 20% working interest and 14.4% net revenue interest.

Additional Well Tests

Several existing well bores have been identified as having the ability to produce oil and gas and tested as follows:

- Lutcher Moore #14: 24-hour test, 40 barrels of oil per day and natural gas at rates of up to 2.5 MMcf/d

- Robert Cain #1: 72-hour test, 10-15 barrels of oil per day and natural gas at rates of up to 100 Mcf/d

- Robert Cain #2: 72-hour test, 30 barrels oil per day and natural gas at rates of up to 350 Mcf/d

Plans to initiate production from these wells are underway by the operator and Red Rock is in discussions to participate in these additional field developments.

Natural Gas Sales

The project management team is undertaking discussions to tie-in production of natural gas utilizing one of two existing tie-in points located at Shoats Creek Field. Once gas sales can be undertaken, additional exploitation opportunities of well bores with re-entry potential in gassier pay zones holds substantial potential to generate additional low risk, low cost revenue at Shoats Creek Field.

Qualified Person

The technical information that is contained in this announcement has been reviewed by Mr. Kevin Green, a Petroleum Geologist who is a suitably qualified person with over 30 years' experience in assessing hydrocarbon reserves and who has consented to the inclusion of the technical information.

For Further Information Contact:

Andrew Bell 0207 747 9990 Chairman Red Rock Resources Plc

Scott Kaintz 0207 747 9990 Director Red Rock Resources Plc

Roland Cornish/ Rosalind Hill Abrahams 0207 628 3396NOMAD Beaumont Cornish Limited

Jason Robertson 0129 351 7744 Broker Dowgate Capital Stockbrokers Ltd


This information is provided by RNS
The company news service from the London Stock Exchange
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