Competent Person's Report on UK Licence P2478
16/02/2023 07:00
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RNS Number : 0739Q Baron Oil PLC 16 February 2023
The information contained within this announcement is deemed by the Company to
constitute inside information pursuant to Article 7 of EU Regulation 596/2014
as it forms part of UK domestic law by virtue of the European Union
(Withdrawal) Act 2018 as amended.
16 February 2023
Baron Oil Plc
("Baron", or the "Company")
Competent Person's Report on UK Licence P2478 ("Dunrobin")
Baron Oil Plc (AIM:BOIL), the AIM-quoted oil and gas exploration and appraisal
company, is pleased to announce that a copy of a Competent Person's Report
("CPR") prepared by the RPS Group ("RPS") on Dunrobin for Licence
Administrator Reabold Resources Plc on behalf of the Joint Venture ("JV"), in
which Baron has a 32% non-operated working interest, can be viewed
here: http://www.rns-pdf.londonstockexchange.com/rns/0739Q_1-2023-2-15.pdf
(http://www.rns-pdf.londonstockexchange.com/rns/0739Q_1-2023-2-15.pdf) , and
will be published shortly on the Company's website at: www.baronoilplc.com
(http://www.baronoilplc.com) . The Dunrobin licence is situated in the Inner
Moray Firth.
The CPR has been prepared in accordance with the June 2018 Petroleum Resources
Management System ("SPE PRMS") as the standard for reporting. A summary of the
gross and net Prospective Resources is given in the table below.
Key Points from the CPR
· 201 mmboe(1) aggregate(2) gross unrisked Pmean Prospective
Resources on licence P2478
· The Dunrobin West prospect ("Dunrobin West") estimated to contain
119mmboe gross unrisked Pmean Prospective Resources aggregated across the
Jurassic and Triassic stacked targets(3)
· 34% Geological Probability of Success (Pg) at Dunrobin West Jurassic
primary target with an estimated 71mmbbl (gross) of Pmean Prospective
Resources
· Seismic response at the Jurassic target at Dunrobin West interpreted
to be a possible gas cap and a gas oil contact
· Dunrobin West geologically analogous to the Beatrice field, which
produced in excess of 140mmbbl
· Secondary Triassic target included in formal resource assessment
for the first time
· The Company has aggregated unrisked net Pmean Prospective Resources
in the CPR and estimates Baron's farm up arrangement of August 2021 has
increased the Company's share of aggregate unrisked net Pmean Prospective
Resources on licence P2478 from 30mmboe to 64mmboe at a capped cost to Baron
of £160,000
(1) The CPR reports oil and gas Prospective Resources. The oil equivalent
value of the gas resources has been estimated by the Company using a factor of
1 barrel of oil to 6 thousand cubic feet of gas.
2 The unrisked aggregation was performed by the Company and assumes that all
prospects at all levels are successful.
3 The unrisked aggregation of Dunrobin West was performed by the Company. The
volumes were presented for each reservoir in the CPR and, at the Company's
request, were not aggregated probabilistically.
Management Commentary
Management estimates, which differ from RPS mainly in their approach to
statistical volumetric estimation, for Dunrobin West for the Jurassic alone
remain in excess of Pmean 100mmbbl* gross unrisked Prospective Resources.
Dunrobin West has been proposed by the JV to be the location of the first
exploration well on the licence. Management believes that a single vertical
borehole on Dunrobin West to a total depth of c.800 metres can test both
Jurassic and Triassic targets at an estimated gross drilling cost of £8.6
million on a dry hole basis. A farmout campaign to attract additional funding
is underway.
Jon Ford, Technical Director of Baron commented…
"We are pleased that the CPR provides independent confirmation for the
Company's belief that the western part of the Dunrobin complex has matured
into a drillable prospect where a relatively low-cost exploration well can
target more than 100 MMbbl* of gross Pmean Prospective Resources with low
geological risk. It validates our decision in 2021 to enter into a farm up
arrangement which more than doubled our working interest in the licence to a
more meaningful 32% by promoting and accelerating the Phase A work programme
to a technically high standard at relatively modest cost.
"The publication of the CPR will add impetus and credibility to the ongoing
farmout campaign which has already attracted industry interest."
Technically Recoverable Prospective Resources
The table below summarises RPS's independent assessment of Gross Prospective
Resources as at the CPR's effective date of 30 September 2022, from which are
derived the Net Prospective Resources attributable to Baron's 32% effective
interest, wholly within the P2478 licence areas. Totals are by arithmetic
summation.
Prospective Resources Gross Attributable to Licence Net Attributable to Baron Oil Risk Factor (GPoS) Operator
Low Estimate Best Estimate High Estimate Mean Estimate Low Estimate Best Estimate High Estimate Mean Estimate
(1U) (2U) (3U) (1U) (2U) (3U)
Technically recoverable resources - Oil (mmbbl)
Dunrobin West Jurassic 7 42 168 71 2 13 54 23 34% Reabold Resources North Sea
Dunrobin West Triassic 7 34 98 45 2 11 31 15 12% "
Dunrobin C&E Jurassic 1 8 67 22 0.4 2 21 7 31% "
Dunrobin C&E Triassic 1 9 56 22 0.3 3 18 7 14% "
Golspie Jurassic 4 12 27 14 1 4 9 5 27% "
Golspie Triassic 7 20 43 23 2 6 14 7 12% "
Aggregate Oil (mmbbl) 27 125 459 197 8 39 147 64
Technically recoverable resources - Associated & Non-associated Gas (bscf)
Dunrobin West Jurassic 2 7 22 10 0.8 2 7 3 34% Reabold Resources North Sea
Dunrobin West Triassic 1 4 11 5 0.2 1 3 2 12% "
Dunrobin C&E Jurassic 0.1 1 7 2 0.04 0.3 2 1 31% "
Dunrobin C&E Triassic 0.1 1 6 2 0.03 0.3 2 1 14% "
Golspie Jurassic 0.4 1 3 2 0.1 0.4 1.0 0.5 27% "
Golspie Triassic 0.8 2 5 3 0.3 0.7 1.5 0.9 12% "
Aggregate Gas (bcf) 4 16 54 24 1 5 17 8
Oil equivalent (mmboe)
Dunrobin West Jurassic 7 43 172 73 2 14 55 23 34% Reabold Resources North Sea
Dunrobin West Triassic 7 35 100 46 2 11 32 15 12% "
Dunrobin C&E Jurassic 1 8 68 22 0.3 3 22 7 31% "
Dunrobin C&E Triassic 1 9 57 22 0.3 3 18 7 14% "
Golspie Jurassic 4 12 28 14 1 4 9 5 27% "
Golspie Triassic 7 20 44 24 2 7 14 8 12% "
Aggregate Oil equivalent (mmboe) 28 128 468 201 8 42 150 65
Notes:
· Company has aggregated P90, P50, P10 and Mean values
arithmetically. This is not statistically correct, and may not sum exactly due
to rounding factors.
· "Gross Attributable" are 100% of the resources attributable to the
licence whilst "Net Attributable" are those attributable to Baron's effective
interest in the licence (32%) before economic limit test.
· Includes a mix of associated gas and non-associated gas from
Dunrobin West Gas Cap, all others are associated gas only
· Mean is defined as the arithmetic average of successful outcomes
· Mmboe calculation, using a factor of 1 barrel of oil to 6
thousand cubic feet of gas, has been provided by Baron for reference for the
purposes of this announcement. See announcement glossary for basis of
calculation
Qualified Person's Statement
Pursuant to the requirements of the AIM Rules - Note for Mining and Oil and
Gas Companies ("AIM MOG"), the technical information and resource reporting
contained in this announcement has been reviewed by Jon Ford BSc, Fellow of
the Geological Society, Technical Director of the Company. Mr Ford has more
than 40 years' experience as a petroleum geoscientist. He has compiled, read
and approved the technical disclosure in this regulatory announcement and
indicated where it does not comply with the Society of Petroleum Engineers'
SPE PRMS standard.
* Not SPE PRMS compliant.
For further information, please contact:
Baron Oil Plc +44 (0) 20 7117 2849
Andy Yeo, Chief Executive
Allenby Capital Limited +44 (0) 20 3328 5656
Nominated Adviser and Broker
Alex Brearley, Nick Harriss, George Payne (Corporate Finance)
Kelly Gardiner (Sales and Corporate Broking)
IFC Advisory Limited +44 (0) 20 3934 6630
Financial PR and IR baronoil@investor-focus.co.uk
Tim Metcalfe, Florence Chandler
Glossary
bscf Billion standard cubic feet of gas.
Best Estimate or 2U Denotes the mid estimate qualifying as Prospective Resources. Reflects a
volume estimate that there is a 50% probability that the quantities actually
recovered will equal or exceed the estimate.
Risk factor, Geological Probability of Success, Pg or GPoS The estimated geological probability of success that exploration activities
will confirm the existence of a significant accumulation of potentially
recoverable petroleum.
High Estimate or 3U Denotes the high estimate qualifying as Prospective Resources. Reflects a
volume estimate that there is a 10% probability that the quantities actually
recovered will equal or exceed the estimate.
Low Estimate or 1U Denotes the low estimate qualifying as Prospective Resources. Reflects a
volume estimate that there is a 90% probability that the quantities actually
recovered will equal or exceed the estimate.
Mean or Pmean Reflects a mid-case volume estimate of resource derived using probabilistic
methodology. This is the mean of the probability distribution for the resource
estimates and may be skewed by resource numbers with relatively low
probabilities.
mmbbl Million barrels of oil.
mmboe Million barrels of oil equivalent. Volume derived by dividing the estimate
of the volume of natural gas in billion cubic feet by six in order to convert
it to an equivalent in million barrels of oil and, where relevant, adding this
to an estimate of the volume of oil in millions of barrels.
Prospective Resources Quantities of petroleum that are estimated to exist originally in naturally
occurring reservoirs, as of a given date. Crude oil in-place, natural gas
in-place, and natural bitumen in-place are defined in the same manner.
SPE PRMS The Society of Petroleum Engineers' ("SPE") Petroleum Resources Management
System ("PRMS"): a system developed for consistent and reliable definition,
classification, and estimation of hydrocarbon resources prepared by the Oil
and Gas Reserves Committee of SPE and approved by the SPE Board in June 2018
following input from six sponsoring societies: the World Petroleum Council,
the American Association of Petroleum Geologists, the Society of Petroleum
Evaluation Engineers, the Society of Exploration Geophysicists, the European
Association of Geoscientists and Engineers, and the Society of Petrophysicists
and Well Log Analysts. Quantities of petroleum estimated, as of a given date,
to be potentially recoverable from undiscovered accumulations by application
of future development projects. The total quantity of petroleum that is
estimated to exist originally in naturally occurring reservoirs, as of a given
date. Crude oil in-place, natural gas in-place, and natural bitumen in-place
are defined in the same manner.
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