RCS - Valeura Energy Inc. - Nong Yao Infrastructure & Wassana Drilling Update

Valeura EnergyAnnouncement

13/02/2024 08:15

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RNS Number : 9459C  Valeura Energy Inc.  13 February 2024

Nong Yao Infrastructure and Wassana Drilling Update

Singapore, February 13, 2024: Valeura Energy Inc. (TSX:VLE, OTCQX:VLERF)
("Valeura" or the "Company"), the upstream oil and gas company with assets in
the Gulf of Thailand and the Thrace Basin of Turkey, is pleased to announce
the mobilisation of a Mobile Offshore Production Unit ("MOPU"), destined for
its Nong Yao field, and to provide an update on development drilling at the
Wassana field, offshore Thailand.

Highlights

·    MOPU TSeven Shirley being mobilised to the Nong Yao field (90%
working interest), in preparation for development of the Nong Yao C
accumulation, first oil expected late Q2 2024;

·    Valeura purchasing the Nong Yao field's floating storage and
offloading vessel ("FSO") Aurora for US$19 million, providing greater
operational flexibility and cost optimisation; and

·    Wassana field (100% working interest) development drilling programme
being expanded to five horizontal wells, first two wells have resulted in
field output increasing to more than 4,000 bbls/d.

Nong Yao Infrastructure

The MOPU TSeven Shirley has departed its shipyard at Qing Dao, China and is
now enroute to Valeura's Nong Yao field (90% working interest) in the Gulf of
Thailand.  Upon arrival, the MOPU will be connected to the pipeline that has
been already installed from the existing Nong Yao field infrastructure, and
will serve as the wellhead production platform for the Company's Nong Yao C
field development.  Following hook-up and commissioning work, Valeura intends
to conduct an initial drilling programme of up to nine development wells (six
producers and three water injectors).  First production from the Nong Yao C
extension is expected in late Q2 2024, and when fully on stream in the months
thereafter, the Company is targeting peak production rates from the greater
Nong Yao field totalling approximately 11,000 bbls/d (90% working interest
share).

The TSeven Shirley is a new-build MOPU, based on a jack-up drilling rig hull,
and customised to suit the requirements of the Nong Yao C accumulation.  The
MOPU includes a 12 slot well bay, total design fluid capacity of  20,000
bbls/d and water injection design capacity of 10,000 bbl/d.  Valeura has
agreed to charter the MOPU for an initial term of five years, with provisions
for extension thereafter.

Separately, Valeura has exercised its purchase option to acquire the Nong Yao
field's FSO Aurora, which it had previously leased from the seller, a member
of the Omni Offshore Terminals group.  Purchase price for the vessel is US$19
million, to be funded with the Company's cash resources upon completion of the
transaction, anticipated in June 2024.  Given the pending expansion of the
field and potential future developments, Valeura anticipates that owning, as
opposed to leasing the FSO will provide operational flexibility and allow the
Company to optimise operating expenses.

Wassana Drilling Update

Valeura is currently executing a development drilling programme on its Wassana
field (100% working interest), and in light of favourable initial results, has
opted to expand the scope of the programme from three horizontal wells to
five.  All three wells drilled so far have encountered their targets in line
with expectations.  The first two wells have been tested and, in their first
seven days of production, resulted in total field output increasing to more
than 4,000 bbls/d.  The third well will be brought online in the coming
days.  Management believes strong proven deliverability from the initial
wells may result in an upward revision to its production expectations from the
field.

The Company intends to continue drilling on the Wassana field, to a total of
five wells, after which the rig will mobilise to the Nong Yao field to begin
Nong Yao C development drilling.

Sean Guest, President and CEO of Valeura commented:

"I am pleased to see our team achieve this key milestone in further
development of the Nong Yao field.  With the deployment of new infrastructure
to the field, excitement is building around the development of the Nong Yao C
accumulation, which is a major component of our production growth plan for
2024, which we anticipate will elevate our share of Nong Yao production to
11,000 bbls/d.  In addition, having the TSeven Shirley MOPU on site provides
another platform for us to pursue further appraisal and exploration work in
the greater Nong Yao area.  At the same time, we are always mindful of the
efficiency of our operations and see the purchase of the Nong Yao FSO a key
step in controlling forward operating costs, thereby contributing to a further
potential extension of the field's economic life.

Separately, the Wassana field continues to surprise to the upside.  When we
first acquired the asset, we envisaged that it would take five additional
wells to develop the deeper reservoir intervals and to achieve rates of 4,500
bbls/d.  With having demonstrated over 4,000 bbl/d with just the first two
horizontal wells, and a third to be brought onstream shortly, we are raising
our expectations for the potential of the field in the near term.  Notably,
this success is in advance of the larger-scale redevelopment we are now
considering for the Wassana field.  The concept select phase of the Wassana
re-development project is progressing well, and we anticipate taking an
investment decision later this year.

Across our portfolio, we continue to find appealing opportunities for organic
growth, as we continue in our strategy to deliver value through growth in all
forms."

 

For further information, please contact:

Valeura Energy Inc. (General Corporate
Enquiries)                       +65 6373 6940

Sean Guest, President and CEO

Yacine Ben-Meriem, CFO
Contact@valeuraenergy.com (mailto:Contact@valeuraenergy.com)

Valeura Energy Inc. (Investor
Enquiries)                             +1 403 975
6752 / +44 7392 940495
Robin James Martin, Vice President, Communications and Investor Relations
IR@valeuraenergy.com (mailto:IR@valeuraenergy.com)

Auctus Advisors LLP (Corporate Broker to
Valeura)                     +44 (0) 7711 627 449
Jonathan Wright
Valeura@auctusadvisors.co.uk (mailto:Valeura@auctusadvisors.co.uk)

CAMARCO (Public Relations, Media Adviser to Valeura)  +44 (0) 20 3757 4980

Owen Roberts, Billy Clegg
Valeura@camarco.co.uk (mailto:Valeura@camarco.co.uk)

 

About the Company

Valeura Energy Inc. is a Canada-based public company engaged in the
exploration, development and production of petroleum and natural gas in
Thailand and in Turkey.  The Company is pursuing a growth-oriented strategy
and intends to re-invest into its producing asset portfolio and to deploy
resources toward further organic and inorganic growth in Southeast Asia.
Valeura aspires toward value accretive growth for stakeholders while adhering
to high standards of environmental, social and governance responsibility.

Additional information relating to Valeura is also available on SEDAR+ at
www.sedarplus.ca (http://www.sedarplus.ca/) .

Initial Production Rates

Initial production rates included in this news release, particularly those
short in duration, may not necessarily be indicative of long-term performance
or of ultimate recovery.  Readers are cautioned that short-term rates should
not be relied upon as indicators of future performance of these wells and
therefore should not be relied upon for investment or other purposes.
Certain of the results provided herein should be considered preliminary.

Advisory and Caution Regarding Forward-Looking Information

Certain information included in this news release constitutes forward-looking
information under applicable securities legislation. Such forward-looking
information is for the purpose of explaining management's current expectations
and plans relating to the future. Readers are cautioned that reliance on such
information may not be appropriate for other purposes, such as making
investment decisions. Forward-looking information typically contains
statements with words such as "anticipate", "believe", "expect", "plan",
"intend", "estimate", "propose", "project", "target" or similar words
suggesting future outcomes or statements regarding an outlook. Forward-looking
information in this news release includes, but is not limited to:  timing for
the Nong Yao C development drilling programme and for first production; target
peak production rates from the greater Nong Yao field to approximately 11,000
bbls/d (90% working interest share); timing to complete the acquisition of the
FSO Aurora and the Company's intention to fund the acquisition with cash
resources; the potential for future developments at the Nong Yao field; the
anticipated reduction in operating expenses and time to pay back the
acquisition price of the FSO Aurora; the expansion of the Wassana field
development drilling programme to five wells; the potential to further extend
the Nong Yao field's economic life; timing to take an investment decision on
the Wassana re-development project; the belief that strong proven
deliverability from the initial wells may result in an upward revision to its
production expectations from the Wassana field; and the ability to continue to
find appealing opportunities for organic growth across the portfolio.
Forward-looking information is based on management's current expectations and
assumptions regarding, among other things: political stability of the areas in
which the Company is operating; continued safety of operations and ability to
proceed in a timely manner; continued operations of and approvals forthcoming
from governments and regulators in a manner consistent with past conduct;
future drilling activity on the required/expected timelines; the prospectivity
of the Company's lands; the continued favourable pricing and operating
netbacks across its business; future production rates and associated operating
netbacks and cash flow; decline rates; future sources of funding; future
economic conditions; the impact of inflation of future costs; future currency
exchange rates; interest rates; the ability to meet drilling deadlines and
fulfil commitments under licences and leases; future commodity prices; the
impact of the Russian invasion of Ukraine; royalty rates and taxes; future
capital and other expenditures; the success obtained in drilling new wells and
working over existing wellbores; the performance of wells and facilities; the
availability of the required capital to funds its exploration, development and
other operations, and the ability of the Company to meet its commitments and
financial obligations; the ability of the Company to secure adequate
processing, transportation, fractionation and storage capacity on acceptable
terms; the capacity and reliability of facilities; the application of
regulatory requirements respecting abandonment and reclamation; the
recoverability of the Company's reserves and contingent resources; ability to
attract a partner to participate in its tight gas exploration/appraisal play
in Turkey; future growth; the sufficiency of budgeted capital expenditures in
carrying out planned activities; the impact of increasing competition; the
ability to efficiently integrate assets and employees acquired through
acquisitions; global energy policies going forward; future debt levels; and
the Company's continued ability to obtain and retain qualified staff and
equipment in a timely and cost efficient manner. In addition, the Company's
work programmes and budgets are in part based upon expected agreement among
joint venture partners and associated exploration, development and marketing
plans and anticipated costs and sales prices, which are subject to change
based on, among other things, the actual results of drilling and related
activity, availability of drilling, offshore storage and offloading facilities
and other specialised oilfield equipment and service providers, changes in
partners' plans and unexpected delays and changes in market conditions.
Although the Company believes the expectations and assumptions reflected in
such forward-looking information are reasonable, they may prove to be
incorrect. Forward-looking information involves significant known and unknown
risks and uncertainties. Exploration, appraisal, and development of oil and
natural gas reserves and resources are speculative activities and involve a
degree of risk. A number of factors could cause actual results to differ
materially from those anticipated by the Company including, but not limited
to: the ability of management to execute its business plan or realise
anticipated benefits from acquisitions; the risk of disruptions from public
health emergencies and/or pandemics; competition for specialised equipment and
human resources; the Company's ability to manage growth; the Company's ability
to manage the costs related to inflation; disruption in supply chains; the
risk of currency fluctuations; changes in interest rates, oil and gas prices
and netbacks; potential changes in joint venture partner strategies and
participation in work programmes; uncertainty regarding the contemplated
timelines and costs for work programme execution; the risks of disruption to
operations and access to worksites; potential changes in laws and regulations,
the uncertainty regarding government and other approvals; counterparty risk;
the risk that financing may not be available; risks associated with weather
delays and natural disasters; and the risk associated with international
activity. See the most recent annual information form and management's
discussion and analysis of the Company for a detailed discussion of the risk
factors.

Certain forward-looking information in this news release may also constitute
"financial outlook" within the meaning of applicable securities legislation.
Financial outlook involves statements about Valeura's prospective financial
performance or position and is based on and subject to the assumptions and
risk factors described above in respect of forward-looking information
generally as well as any other specific assumptions and risk factors in
relation to such financial outlook noted in this news release. Such
assumptions are based on management's assessment of the relevant information
currently available, and any financial outlook included in this news release
is made as of the date hereof and provided for the purpose of helping readers
understand Valeura's current expectations and plans for the future. Readers
are cautioned that reliance on any financial outlook may not be appropriate
for other purposes or in other circumstances and that the risk factors
described above or other factors may cause actual results to differ materially
from any financial outlook. The forward-looking information contained in this
new release is made as of the date hereof and the Company undertakes no
obligation to update publicly or revise any forward-looking information,
whether as a result of new information, future events or otherwise, unless
required by applicable securities laws. The forward-looking information
contained in this new release is expressly qualified by this cautionary
statement.

This news release does not constitute an offer to sell or the solicitation of
an offer to buy securities in any jurisdiction, including where such offer
would be unlawful. This news release is not for distribution or release,
directly or indirectly, in or into the United States, Ireland, the Republic of
South Africa or Japan or any other jurisdiction in which its publication or
distribution would be unlawful.

Neither the Toronto Stock Exchange nor its Regulation Services Provider (as
that term is defined in the policies of the Toronto Stock Exchange) accepts
responsibility for the adequacy or accuracy of this news release.

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