TIDMPGR
12 March 2018
Phoenix Global Resources plc
("Phoenix" or the "Company")
Unconventional Oil & Gas Regulations in Mendoza
Provinces
Phoenix Global Resources plc (AIM: PGR; BCBA: PGR) is pleased to
announce that the Government of the Mendoza Province issued its
Unconventional Oil & Gas Regulations on 9 March 2018.
The Unconventional Oil & Gas Regulations are the result of
several month's work by the province and its advisers and, in the
view of the management of Phoenix, they are in line with industry
best practice and the expectations of the Argentine oil & gas
industry. Phoenix welcomes the new regulations, which balance the
mutual objectives of the industry, local communities and the
protection of the environment.
The new regulations pave the way for Phoenix to accelerate the
permitting process to complete our drilled but uncompleted wells in
the Puesto Rojas licence area. These wells target both the Tight
Agrio and Vaca Muerta formations. Phoenix applied for an
unconventional licence for the Puesto Rojas area in 2017 and we
look forward to this being granted in the near future.
The new regulations will also allow Phoenix to proceed with its
unconventional exploration and development plans elsewhere in the
Mendoza Province, which together with plans for the Puesto Rojas
area, are important elements of the Company's accelerated 2018
business plan. The responsible development of unconventional
resources in Mendoza by Phoenix and others in the industry will
bring further investment and job creation to the Province of
Mendoza.
Accelerated 2018 Business Plan
2018 represents the first full year of Phoenix following the
Reverse Takeover in August 2017.
As announced on 16 February 2018 and reproduced below, the
Company plans to accelerate its drilling and completion programme
in 2018 and based on results obtained from its exploration and
development activities during the coming year, it expects to double
its capital expenditure from approximately US$90 million in 2017 to
up to US$190 million.
Neuquina basin
The 2018 planned drilling programme is focused on accelerating
the appraisal and development of Phoenix's significant Vaca Muerta
and other unconventional resources in the Neuquina basin. The
Company plans to spend up to US$120 million of total budgeted 2018
capital expenditure on developing these unconventional resources in
the Neuquina basin. This activity is expected to de-risk a
significant portion of its unconventional acreage and also provide
the basis for robust production growth going forward.
In the Mendoza Province, during 2017, the Company drilled nine
vertical wells in the Puesto Rojas area, of which five wells were
designed to appraise the unconventional Vaca Muerta and Tight Agrio
formations. Further unconventional exploration and development
activity can now recommence post the finalisation of the new
unconventional oil and gas regulations in Mendoza Province.
The Company's 2018 business plan focuses on the drilling and
completion of further vertical development and exploration wells in
the Puesto Rojas area, targeting additional prospects in the
unconventional Vaca Muerta and Tight Agrio formations, as well as
drilling selected conventional targets. The drilling plan for the
Company's unconventional assets, together with the acquisition and
processing of additional seismic data in the southern Puesto Rojas
and La Brea concessions, is designed to prepare these assets for
large scale unconventional development.
In the second half of the year, the Company plans to drill and
complete its first horizontal well in the Puesto Rojas area,
following appraisal of its vertical wells to identify which
horizons are likely to deliver the best rates and economic
return.
In the Neuquén Province, the Company intends to move forward
with its investment plans on its Mata Mora and Corralera licences.
The Company plans to drill and complete unconventional horizontal
wells under its existing agreement with GyP and hopes to commence
the drilling of its first horizontal well on its Mata Mora block in
the first half of 2018.
In addition, the Company plans to continue to invest in the
Chachahuen development, with our operating partner YPF,
participating in approximately 80 new wells in the year. Chachahuen
should continue to deliver low risk and low cost production
growth.
Approximately 85% of the 2018 planned capital expenditure is
focused on the Neuquina basin, of which the majority will be
deployed in Phoenix operated assets.
Cuyana and Austral basins
In 2018, Phoenix plans to invest in additional exploration and
development wells in its Cuyana basin licences to increase oil
production and its Santa Cruz Sur licences in the Austral basin to
increase gas production.
Approximately 15% of the 2018 planned capital expenditure is
focused on the Cuyana and Austral basins.
Anuj Sharma, CEO said:
"I am delighted that the Province of Mendoza has today announced
the new regulations for unconventional oil and gas development.
These new regulations provide a clear and balanced framework for
the responsible development of unconventional oil and gas and
represent a significant step forward in realising the full
potential of the Neuquina basin in the Mendoza Province.
Importantly, the regulations also provide the foundation for
further investment and the creation of new jobs in Mendoza.
The announcement of these new regulations will allow Phoenix to
recommence and accelerate our unconventional development programme
and enable us to play our role in this exciting new chapter for the
oil and gas industry in Argentina."
For further information, please contact:
Phoenix Global Resources plc Anuj Sharma, CEO T: +54 11 5258 7500
Philip Wolfe, CFO T: +44 20 3912 2805
Stockdale Securities Antonio Bossi T: +44 20 7601 6100
Ed Thomas
Panmure Gordon Adam James T: +44 20 7886 2500
Atholl Tweedie
Camarco Billy Clegg T: +44 20 3757 4980
Owen Roberts
James Crothers
About Phoenix
Phoenix Global Resources is a London Stock Exchange (AIM: PGR)
and Buenos Aires Stock Exchange (BCBA: PGR) listed independent
Argentina focused oil and gas exploration and production company.
The Company has over 6.3 million licensed working interest acres in
Argentina (of which over 5 million are operated), 61.7 million boe
of working interest 2P reserves and average production of
approximately 11,070 working interest boepd in 2017. Phoenix has
significant exposure to the unconventional opportunity in Argentina
through its 480,000 working interest acres with Vaca Muerta
potential.
The Company's website is www.phoenixglobalresources.com
View source version on businesswire.com:
http://www.businesswire.com/news/home/20180312005320/en/
This information is provided by Business Wire
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