Red Rock Resources logo

RRR - Red Rock Resources News Story

0.925p 0.0  0.0%

Last Trade - 1:59pm

Sector
Basic Materials
Size
Micro Cap
Market Cap £11.0m
Enterprise Value £11.1m
Revenue £n/a
Position in Universe 1589th / 1826

Red Rock Resources - Shoats Creek Update

Wed 8th June, 2016 7:35am
RNS Number : 5642A
Red Rock Resources plc
08 June 2016

Red Rock Resources plc

("Red Rock" or the "Company")

Shoats Creek Update

8 June 2016

Further to the announcements of 24th March 2016, and 5th May 2016, Red Rock announces an update on the 2016 work programme at the Shoats Creek Field in Beauregard Parish, Louisiana.

Highlights:

Identified new low cost recompletion opportunity at LM19 well

Re-entry at LM19 completed in Frio Sands - 10 Feet of targeted pay

Successful LM19 adds multiple potential new drilling locations

Await verified quarterly production figures for the project

Updated spud date for high priority LM21well

Red Rock Chairman Andrew Bell comments: "There have been development delays since production began earlier this year and the original spud date for the LM21 was not met, but the investor group has been quick to assess and seize the new opportunity at the LM19. As the operator gains experience, we expect to improve operational effectiveness, while retaining this flexibility and entrepreneurial drive.

The LM19 recompletion is a low cost and low risk attempt to exploit established Frio pay and add inexpensive and meaningful production to the project. We look forward to the results of this effort and to updating the market on quarterly production and the spudding of LM21. The 2016 work programme at Shoats Creek is focussed on driving production growth by taking advantage of current low drilling and development costs, and with improved oil prices this should flow through directly to the Company's bottom line."

Re-entry and Recompletion of Lutcher Moore 19 ('LM19') Well

The operator has completed a re-entry and recompletion of the Lutcher Moore 19 well, targeting production from the Frio formation. Re-entry of this well did not form part of the 2016 work plan, but on new advice and analysis a decision to proceed immediately with this initiative was made. Key factors were the low expected cost of re-entry and recompletion, and the potential to add meaningful reserves and production. The squeeze job (cement job to isolate the targeted Frio formation) is complete and the operator intends to perforate and swab the well this week. Updates to the economic viability and sustainable production rates from the well will be announced in due course.

A successful recompletion will potentially add several drilling locations to the inventory of viable Frio drilling locations at the Shoats Creek Field and total cost of the effort is expected to be around $40k, or approximately $8k to Red Rock. Red Rock will have a 20% working interest and a 14.4% net revenue interest.

Lutcher Moore 21 ('LM21') well

Preparatory work to drill the Lutcher Moore 21, in which Red Rock will have a 20% working interest and a 14.4% net revenue interest, as an offset to the Lutcher Moore 8 ('LM8'), is proceeding. The originally forecast spud date of around the middle of May was delayed by a number of regulatory and other factors that have since been remedied. An announcement on the revised spud date will follow.

The LM8, which was originally drilled to 9136' in 1950 and completed in the Cockfield-5 formation, initially produced 185 barrels of oil and 185 thousand cubic feet per day of natural gas with no water. The logs indicate Frio pay from 5029'-5036'. The LM21 will be located to the northwest of the LM8 to position it structurally higher in the formation with the hope of intersecting a thicker payzone than the LM8 encountered.

Quarterly Production Update

Production and sales of oil continue and the Company awaits verified and finalized production and sales data from the operator for the production period to date, following which a further announcement will be made.

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, please 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
END
MSCFMGGVVRFGVZG
© Stockopedia 2021, Refinitiv, Share Data Services.
This site cannot substitute for professional investment advice or independent factual verification. To use it, you must accept our Terms of Use, Privacy and Disclaimer policies.