President Energy drilling results so far support pre-drill P50 projections

President Energy plc (LON:PPC), the energy company with a diverse portfolio of production and exploration assets, has provided an update in relation to the drilling of the exploration well EVN-x1 near the Estancia Vieja field, Rio Negro Province, Argentina.

Key points

• Well successfully drilled to target depth of 2,000 metres and cased on time and budget

• Both full suite electric logs and mud logs show clear moveable live gas and oil pay with good pressure, porosity and permeability

• The results so far support pre-drill P50 projections, subject to testing in due course

• Drilling rig is demobilising and the well will be completed and tested before the end of the year by the workover rig 

Drilling Programme

The exploration well EVN-x1 has been successfully drilled to its target depth of 2,000 metres and cased on time and on budget.

Before casing, a full suite of electric logs were run as well as pressure testing to supplement the mud logs obtained during the drilling process.

The electric logs confirmed the evidence shown by mud logs of net pay of a total of 10 metres (33 feet) of clear live moveable hydrocarbon pay in two clean sand intervals both with good pressure, permeability and porosity (latter in excess of 20%). Of this some 7 metres (23 feet) is considered oil and the balance gas.

These results provide support for the pre-drill projections of production of 60,000 m3/d (353 boepd) of gas and 188 bopd which can only be verified on testing due to the fact that this is a previously undrilled structure with no direct analogue as to production performance. Accordingly, until successful testing, it is too early to come to any conclusions as to actual producibility and size of the respective reservoirs for gas and oil. Testing will be made of each individual interval which will not be co-mingled.

The drilling rig is now beginning to demobilise back to its base and the workover rig will be brought in to complete and test the well. This is expected to be before the end of the year as the rig is committed to work in President’s Puesto Flores field to repair two producing wells and then to go to the Las Bases field to perform one or two workovers on shut in wells generated by the success of the Las Bases 1001 well drilled last month.

Dr Martin Gee, PhD in Geophysics (Oxon), BSc (First Class hons) in Earth Sciences (Cardiff) who meets the criteria for qualified persons under the AIM guidance note for mining and gas companies, has reviewed and approved the technical information contained in this announcement

Glossary:

Bopd means barrels of oil per day

Boepd means barrels of oil equivalent (oil and gas) per day

EV means the Estancia Vieja field in the Puesto Flores/Estancia Vieja Concession, Rio Negro, Argentina

LB means the Las Bases Concession, Rio Negro , Argentina

M3/d means cubic metres of production of gas or oil as the case may be

P50 means internal mid-case estimate

Peter Levine, President Energy Chairman commented

“It is always good to see clear evidence of moveable live gas and oil in an exploration well being drilled in a new structure.

“However, it is precisely because of that and the lack of analogue evidence that one must prudently reserve judgement and be cautious until the well is tested within the next two months once the workover rig finishes other pre-planned work in our fields.

“In the meantime, as previously announced, we are looking to materially increase our gas production around the end November bringing on line two/three new contributors, also putting back on line certain oil wells in Rio Negro which have been out of commission for several months requiring repair”.

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