- Guercif rigless testing on track and scheduled for September execution
- CNG development planning on schedule
- Future attractive risk-reward Jurassic drilling being matured
- Cory Moruga acquisition opportunity making progress
- Continuing dialogue on Corrib South successor authorisation
Predator Oil & Gas Holdings Plc (PRD), the Jersey based Oil and Gas Company with near-term gas operations focussed on Morocco, is pleased to announce an operations update.
The proposed rigless testing programme has been presented to the Office National des Hydrocarbures et des Mines ("ONHYM").
MOU-1 will be the first well in the rigless testing programme to be performed by Energy Consulting Services ("ECS") based in France and with a licence to use and operate the Sandjet perforating technology.
Ten individual horizons within the interval 1217 to 1300 metres TVD KB have been selected for perforating.
In the interval 769 to 912 metres TVD KB a further eight individual horizons have been selected for perforating.
Four additional data points between 1397 to 1400.5 and 967 to 991 metres and at 1035 metres TVD KB may be added to provide information that may be potentially useful for the finalisation of the MOU-3 rigless testing programme.
The MOU-1 well will establish Sandjet rigless testing procedures and will adjust the operating parameters to optimise the depth of penetration into the reservoirs of interest if and where required.
Testing individual sands in sequence from the bottom of the MOU-1 well upwards will evaluate the potential for co-mingling different sand intervals on production and help determine if there is a requirement to isolate any interval downhole based on any material water cut.
An alternative to a coiled tubing unit originally sourced out of Tunisia, which is required to run the Sandjet perforating tool, has been now been sourced in France by ECS. This will enable the testing programme to commence at the earliest possible opportunity in September. Shipping logistics from Tunisia, due to competition for vessel cargo space, created uncertainty regarding the exact scheduling of commencement of field operations.
The adjusted schedule for delivery of the Sandjet equipment is currently being put together by ECS and a further announcement will be made when this is finalised.
Future drilling opportunities
The updip appraisal of the Jurassic target encountered in MOU-4 is a key objective of the Company.
Three preliminary drilling locations are being selected for inclusion in a new Environmental Impact Assessment ("EIA").
Well design and sourcing of long lead well inventory has commenced.
A field trip is being planned for the autumn to evaluate the reservoir potential of the entire interval of interest in Jurassic surface exposures to the south of the Guercif licence area.
Geochemical source rock quality and maturation studies, including evidence for migrated gas, for the Jurassic section penetrated in the MOU-4 well are expected to be completed in September.
Two other near-term drilling opportunities are also being assessed, one location covered by an existing EIA and the other to be added to the new EIA. Evaluation of the higher pressure shallow gas encountered in MOU-3 and a southwest extension of the MOU-3 structure would be the targets for future drilling.
On 8 March 2023, the Company announced that it had entered into an agreement ("Agreement") with Challenger Energy Group Plc pertaining to the sale of the Cory Moruga asset in Trinidad. In that announcement, it was noted that completion of the transaction was conditional on consent of the Trinidadian Ministry of Energy and Energy Industries ("MEEI") to a revised work programme for the Cory Moruga licence proposed by the Company, as well as agreement of MEEI to a revision of future fees for the Cory Moruga licence and a settlement / cancellation of past claimed dues pertaining to the Cory Moruga licence. The Agreement stipulated a long stop date of 31 August 2023 for securing the relevant consent and agreements from MEEI.
Dialogue with MEEI continues, with the parties having made progress on reaching acceptable terms, and the parties remain confident that appropriate consents and agreement will be forthcoming. However, completion of the transaction will not be possible by 31 August 2023. Accordingly, the parties have mutually agreed to extend the last date for completion of the intended transaction by 3 months, to 30 November 2023.
The Company sees the opportunity for a future drilling programme at Cory Moruga with the objective of confirming hydrocarbon resources and delivering a high productivity well in a primarily undeveloped field.
As part of the Agreement, and as advised on 8 March 2023, the parties had also agreed to establish a collaboration in relation to CO2 EOR activities and projects in other areas in Trinidad. In parallel to the ongoing process to complete the sale of the Cory Moruga asset in Trinidad, the parties have progressed discussions seeking to re-establish partnering arrangements in relation to other assets, in particular the Inniss-Trinity field - further announcements will be made as appropriate.
In the longer term, scaling up of potential CO2 EOR operations and the creation of cost-saving operational synergies are likely to be considered by the Company subject to updating of project economics. CO2 EOR operations would initially be conducted on an individual well basis to potentially provide a contribution to Company overheads and operating costs as a Cory Moruga drilling programme progresses, subject to regulatory consents.
On the 28 July 2023 the Company received an acknowledgement from the Department of the Environment, Climate and Communications ("DECC") that a request made on behalf of the Company and its potential partner in the event of a future award of a Frontier Exploration Licence in respect of "Corrib South" was receiving attention.
Corrib South has mid and high case estimates for gross gas resources of 137.8 and 484.8 BCF respectively (PRD net interest 50%) with a 44% chance of geological success and a 50% chance of development (Tracs International Limited July 2023).
Paul Griffiths, Executive Chairman of Predator Oil & Gas Holdings Plc commented:
"The Sandjet rigless testing programme is on track and scheduled to be executed and completed in September.
In parallel with the testing programme agreements for the sale of gas and sourcing and scheduling for delivery of long lead items required for the CNG development and an Environmental Impact Assessment are being progressed.
Company strategy is to develop a revenue-generating business opportunity capable of being monetised under the right market conditions.
Opportunities for further drilling, in particular to evaluate the Jurassic structure partly penetrated by MOU-4, are being developed. The strategy has a clear objective to identify and pursue balanced risk-reward projects where early near-term shareholder value can be delivered through drilling success. Current market dynamics support drilling activity and very near-term value creation.
Subject to rigless testing results, an initial Compressed Natural Gas development can potentially be funded by a debt instrument linked to production thereby freeing up existing cash resources for more high impact drilling.
Trinidad offers a separate potential future drilling opportunity in an under-developed onshore field. The project is capable of adding primary hydrocarbon resources that can grow into a significant cash-generating business. There are few such opportunities remaining onshore in Trinidad.
Corrib South in Ireland remains an attractive commercial proposition for gas whilst also potentially contributing to the longevity and commerciality of the Corrib infrastructure through the energy transition. This could underpin potential use of the infrastructure beyond the Energy Transition for blended gas and hydrogen storage.
The Company remains active on three fronts and will continue to deliver shareholder value as and when the opportunity arises within its portfolio of projects."