Baron Oil Plc has updated its website to include information on the TL-SO-19-16 PSC (the "Chuditch PSC") that has been derived from publicly released reports on the area prepared by Shell Development (Australia) Pty. Ltd. ("Shell") in 1998 and 2001 following the drilling of the Chuditch-1 discovery well. This well, was drilled in 64 metres water depth in a total of 25 days for US$8 million and encountered a 25m gas column in the Jurassic Plover formation on the flank of a faulted structure. The reports include estimates of gas in place and percentages recoverable that were defined by Shell's internal analyses and are therefore not compliant with the 2018 SPE PRMS Prospective Resources standard.
Key Points for the combined Chuditch, Chuditch North and Chuditch South closures ("Greater Chuditch") within the Chuditch PSC:
· Total gross estimate of Mean gas in place (GIIP) of 2,320 BCF
· Gas recovery expected by Shell to be in the range of 55% to 75%, leading to gross estimates of Mean recoverable gas of 1,276 to 1,740 BCF, considered by Baron to be Prospective Resources
· Risks associated with trap, reservoir and charge for the Greater Chuditch closure were considered by Shell to be zero (that is, the Geological Chance of Success is assumed to be 100%), remaining uncertainty being on the volumes in place
Baron intends to invest in the Chuditch PSC project through its entitlement to a one third shareholding in SundaGas (Timor-Leste Sahul) Pte. Ltd. ("SundaGas TLS"), equating to an indirect net 25% interest in the Chuditch PSC.
Dr Malcolm Butler, Executive Chairman of Baron, commented:
"The information from the Shell reports gives a clear indication of the substantial potential for hydrocarbons within the Chuditch PSC and the reason that Baron has maintained its entitlement to invest into SundaGas TLS since 2016. Now that the Chuditch PSC has been confirmed and the guarantee bond posted, the work programme over the next three years is designed to further define the size of the Greater Chuditch accumulation and the potential of nearby untested prospects, through seismic reprocessing and drilling, in order to formulate plans for commercialisation. The figures computed by Shell clearly indicate the size of the potential prize.
"Much has changed in Timor-Leste since the late 1990's, including the declaration of independence in 2002 and ratification of the Maritime Boundary treaty with Australia in 2019. In addition, gas markets have grown tremendously in Asia Pacific and, in the Timor Sea region, gas infrastructure and associated LNG facilities have been established."
Competent Person's Statement
Pursuant to the requirements of the AIM Rules - Note for Mining and Oil and Gas Companies, the technical information and resource reporting contained in this announcement has been reviewed by Dr Malcolm Butler BSc, PhD, FGS, Executive Chairman of the Company. Dr Butler has more than 45 years' experience as a petroleum geologist. 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' standard.