TIDMALBA
RNS Number : 8516L
Alba Mineral Resources PLC
15 January 2021
Alba Mineral Resources plc
("Alba" or the "Company")
Horse Hill Update
Alba Mineral Resources plc (AIM: ALBA) reports that UK Oil &
Gas Plc ("UKOG"), as majority shareholder of Horse Hill
Developments Limited (the Operator of the Horse Hill Oil Project in
the Weald Basin in southern England) (together the "Operator"), has
provided the following update in relation to the Horse Hill Oil
Project:
Production and well intervention
- To date, the field has produced and exported over 132,000
barrels ("bbl") of Brent quality crude from its Kimmeridge and
Portland oil pools.
- Despite the downtime for the Horse Hill-1 well ("HH-1")
intervention in Q4 2020, the total Portland oil production for the
December quarter was 7,045 bbl. The average production uptime was
57% over the period and ranged from 37% during October's main HH-1
intervention period, to 85% in November, post-intervention.
- As announced on 5 November 2020, an intervention was completed
to reperforate the full Portland oil-producing section, insert a
new simplified production tubing string and set the downhole pump
at a deeper level to increase Portland pumping efficiency.
- The intervention was immediately followed by an ongoing series
of multi-week production optimisation trials to achieve an optimum
balance between oil revenues and water handling and other
operational costs. Trials include well-cycling (i.e., shutting in
the well for a set period each day to reduce water inflow) and pump
fill optimisation. The trials are expected to continue for several
months. The Operator reports that early results are encouraging,
with stable water influx levels achieved by the end of 2020.
Water reinjection
- Horse Hill's planning consent includes a provision for a
formation water reinjection well. Consequently, to remove the need
for off-site water disposal via tanker and to also help maximise
oil recovery by supporting reservoir pressure, the Operator reports
that it plans to reconfigure Horse Hill-2z well ("HH-2z") into a
water re-injection well as soon as practicable, subject to
regulatory consent.
Infill drilling plans
- The Operator reports that it has completed the interpretation
of static and flowing data from November's pressure build-up
("PBU") test sequence, confirming HH-1 connected oil in place
volumes of 7-11 million barrels ("mmbbl") previously reported in
October 2018. The PBU data also helped to identify a potentially
significant contribution to Portland fluid flow from a natural
fracture system. The Operator reports that technical work is
ongoing to further characterise the Portland reservoir's delivery
mechanisms and, in particular, the prevalence and role of the
natural fracturing within the Portland section.
- The recent integration of the November 2020 PBU data, HH-2z
rock data and a completely revised seismic interpretation has
provided a far better understanding of the Portland reservoir. The
Operator reports that several significant infill drilling
opportunities have now been identified in the Portland oil pool,
all up-dip of HH-1 (i.e., at a shallower depth within the oil pool)
and significantly above the oil-water contact.
- The Operator reports that following the successful flow
testing of the Kimmeridge oil pool, during which 52,780 bbl of
40deg API oil were produced, further development of the Kimmeridge
oil pool also remains a significant objective. Consequently, the
Operator plans to drill an infill well to determine the lateral
extent of the Kimmeridge oil pool, proven by HH-1 to lie within a
natural fracture system of significant vertical extent.
- The Kimmeridge HH-4 well, also situated updip of both HH-1 and
HH-2z, is likely to be a highly inclined or "slant" well, designed
with a lateral orientation approximately orthogonal to the known
regional open natural fracture direction, so as to maximise the
number of open fractures penetrated.
- The Operator reports that it expects to plan and drill these
Portland (HH-3) and Kimmeridge (HH-4) infill wells following the
completion of UKOG's appraisal drilling campaign on another project
unrelated to Horse Hill.
George Frangeskides, Executive Chairman, commented:
"We are encouraged by the Operator's revised strategy for the
exploitation of the Horse Hill Oil Field. Their confirmation of the
connected oil in place volumes of 7-11 million barrels from the
Portland oil pool alone highlights the untapped production that
remains in the Portland, production that cannot hope to be fully
realised from HH-1 alone. The plans, therefore, to drill another
two vertical wells up-dip of HH-1 are welcome, not least in the
light of the sustained rally in the oil price over the past three
quarters."
"Also encouraging is the Operator's reaffirmation of the
potential of the Kimmeridge oil pool. HH-1 has already proven the
Kimmeridge's ability to contribute substantial production to the
overall field, so there is certainly merit in testing the
Kimmeridge's producibility from a new vertical well. We look
forward to the Operator delivering on this revised and reaffirmed
strategy for enhancing production and delivering on the inherent
value of the Horse Hill Oil Field."
This announcement contains inside information for the purposes
of Article 7 of EU Regulation 596/2014.
Forward Looking Statements
This announcement contains forward-looking statements relating
to expected or anticipated future events and anticipated results
that are forward-looking in nature and, as a result, are subject to
certain risks and uncertainties, such as general economic, market
and business conditions, competition for qualified staff, the
regulatory process and actions, technical issues, new legislation,
uncertainties resulting from potential delays or changes in plans,
uncertainties resulting from working in a new political
jurisdiction, uncertainties regarding the results of exploration,
uncertainties regarding the timing and granting of prospecting
rights, uncertainties regarding the timing and granting of
regulatory and other third party consents and approvals,
uncertainties regarding the Company's or any third party's ability
to execute and implement future plans, and the occurrence of
unexpected events.
Information which is provided to the Company for release by or
on behalf of a third-party operator of a project in which the
Company holds a minority interest is not independently verified by
the Company. The Company relies upon the operator for the veracity
of such information.
Without prejudice to the generality of the foregoing,
uncertainties also exist in connection with the ongoing Coronavirus
(COVID-19) pandemic which may result in further lockdown measures
and restrictions being imposed by Governments and other competent
regulatory bodies and agencies from time to time in response to the
pandemic, which measures and restrictions may prevent or inhibit
the Company from executing its work activities according to the
timelines set out in this announcement or indeed from executing its
work activities at all. The Coronavirus (COVID-19) pandemic may
also affect the Company's ability to execute its work activities
due to personnel and contractors testing positive for COVID-19 or
otherwise being required to self-isolate from time to time.
Actual results achieved may vary from the information provided
herein as a result of numerous known and unknown risks and
uncertainties and other factors.
Qualified Person's Statement
The technical information contained in this announcement has
been reviewed and approved by Feroz Sultan (B.Sc (Hons) Geology,
M.Sc, Petroleum and Structural Geology, Karachi and M.Sc Petroleum
Geology, Imperial College London), a petroleum geologist with over
45 years' experience in the management, exploration, development
and production of oil and gas.
Glossary
API: a measure of the density of crude oil, as defined by the
American Petroleum Institute
natural fracturing or natural fracture systems : fractured
reservoirs contain cracks or surface of breakage within rock.
Fractures can significantly enhance the permeability of rocks by
connecting pores together. Naturally fractured reservoirs have been
created over geological time by nature, not man-made via hydraulic
fracturing.
oil field : an accumulation, pool or group of pools of oil in
the subsurface that produces, or can produce, oil to surface.
oil in place : the quantity of oil or petroleum that is
estimated to exist originally in naturally occurring accumulations
in the ground before any extraction or production.
For further information, please contact:
Alba Mineral Resources plc
George Frangeskides, Executive Chairman +44 20 3950 0725
Cairn Financial Advisers LLP (Nomad)
James Caithie / Liam Murray +44 20 7213 0880
ETX Capital (Broker)
Thomas Smith +44 20 7392 1494
Alba's Project and Investment Portfolio
Project (commodity) Location Ownership
Mining Projects
Amitsoq (graphite) Greenland 90%
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Clogau (gold) Wales 90%
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Gwynfynydd (gold) Wales 100%
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Inglefield (copper, cobalt,
gold) Greenland 100%
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Limerick (zinc-lead) Ireland 100%
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Melville Bay (iron ore) Greenland 51%
----------- ----------
TBS (ilmenite) Greenland 100%
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Oil & Gas Investments
Brockham (oil) England 5%
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Horse Hill (oil) England 11.765%
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