TIDMRPT
RNS Number : 7990T
Enwell Energy PLC
29 November 2021
29 November 2021
Enwell Energy plc
("Enwell" or the "Company")
Ukrainian Operations Update
Enwell Energy plc (AIM: ENW), the AIM-quoted oil and gas
exploration and production group, provides an update on operations
at its Mekhediviska-Golotvshinska (MEX-GOL) and Svyrydivske (SV)
gas and condensate fields and its Svystunivsko-Chervonolutskyi (SC)
exploration licence in Ukraine.
At the SV field, testing operations on the SV-29 development
well were delayed for a period due to local shortages of materials
required in the operations, but supplies have now improved and
progress has been made with the initial testing of the well. The
well was spudded in February 2021 and drilled to a final depth of
5,450 metres. The primary target of the well was the V-22 reservoir
within the Visean formation, and to date, one interval within this
reservoir, at a drilled depth of 5,246 - 5,249 metres, has been
perforated. Testing of this interval is underway using a variety of
choke sizes, and initial results are promising, with gas flows and
an unexpectedly high, but somewhat variable, proportion of
condensate. The higher than anticipated condensate rates have
required that the testing procedures be modified, such that a
longer period of initial testing of this interval will be required.
Once completed, it is intended to perforate and test a further
interval, at a drilled depth of 5,228 - 5,232 metres, in the V-22
reservoir. Thereafter, the well will be run through the gas
processing facilities to allow longer-term production testing to be
conducted in order to optimise the operating parameters of the
well. The well was also appraising the V-21 and V-23 horizons, and
within these horizons, there were indications of hydrocarbons based
on well logs which warrant further investigation in due course.
Drilling of the SV-31 well at the SV field is ongoing, with the
well having reached a depth of approximately 4,489 metres. This
well was spudded in September 2021, and has a target depth of 5,250
metres. The well is a development well, targeting production from
the V-21 and V-22 reservoirs in the Visean formation, which have
demonstrated good productivity in an existing nearby well. Drilling
operations are scheduled to be completed by the end of the first
quarter of 2022, and, subject to successful testing, production
hook-up is scheduled during the second quarter of 2022.
In addition, the SV-2 well at the SV field has experienced water
ingress and consequently has been taken off production. A workover
of this well is being undertaken to investigate the cause of, and
seek to remedy, the water ingress, which is planned to include the
replacement of the production string. However, the well was drilled
in the early 1980s, and so the condition of the equipment in the
well may be poor and require alternative work to remedy the water
ingress. This well is operated under a joint venture agreement with
PJSC Ukrnafta, the majority State-owned oil and gas producer,
pursuant to which the gas and condensate produced is sold under an
equal net profit sharing arrangement between the Company and PJSC
Ukrnafta.
At the MEX field, the MEX-109 well has also experienced water
ingress and as a result has been taken off production. This well
was drilled by the Company and completed in 2017, and therefore
technical information on the well is readily available to the
Company's technical team to assist with the investigation of the
cause of the water ingress. A workover of the well is underway, and
logging will be undertaken shortly to identify the source of the
water ingress, followed by appropriate remedial works.
The shut-in of the SV-2 and MEX-109 wells has impacted current
production rates and, depending on the duration of the requisite
remedial works, will potentially have a material impact on the
Company's overall production volumes for Q4 2021. However,
continued high hydrocarbons sales prices will help to offset the
anticipated overall lower production volumes and the resultant
impact on revenues in Q4 2021.
At the SC licence, drilling of the SC-4 well is continuing, with
the well having reached a depth of approximately 4,613 metres. This
well was spudded in August 2021, and has a target depth of 5,565
metres. The well is primarily an appraisal well, targeting
production from the V-22 horizon, as well as exploring the V-16 and
V-21 horizons, in the Visean formation. Drilling operations are
scheduled to be completed in mid-2022.
Also at the SC licence, the acquisition of 1 50 km(2) of 3D
seismic has commenced, and is expected to be completed early in
2022, with processing and interpretation of the acquired seismic
data scheduled for completion in Q2 2022.
Finally, construction work on the upgrades to the gas processing
facilities at the MEX-GOL and SV fields is underway. In total, the
upgrade works are scheduled to take approximately three and a half
months to complete. T hese works involve an upgrade of the LPG
extraction circuit, an increase to the flow capacity of the
facilities, and a significant increase to the liquids tank storage
capacity, which are designed to improve overall plant efficiencies
, improve the quality of liquids produced and boost recoveries of
LPG, while reducing environmental emissions.
Further updates on the progress of the abovementioned
operational activities will be made in due course as further
information becomes available.
Sergii Glazunov, Chief Executive Officer, said: " We are pleased
to finally have some initial results from the SV-29 well, after the
delays caused by the supply constraints in Ukraine, and look
forward to making further progress with the testing of this well.
We are also pleased with the good progress we are making in the
drilling of the SV-31 and SC-4 wells, the commencement of the
acquisition of 3D seismic at the SC licence and the initiation of
the construction works at the MEX-GOL and SV gas processing
facilities. It is unfortunate that both the SV-2 and MEX-109 wells
have suffered water ingress around the same time, but we have moved
quicky to commence workover operations on both wells and hope to
remedy the issues encountered in the near future."
This announcement contains inside information for the purposes
of Article 7 of EU Regulation 596/2014, which forms part of United
Kingdom domestic law by virtue of the European Union (Withdrawal)
Act 2018, as amended.
For further information, please contact:
Enwell Energy plc Tel: 020 3427 3550
Chris Hopkinson, Chairman
Sergii Glazunov, Chief Executive Officer
Bruce Burrows, Finance Director
Strand Hanson Limited Tel: 020 7409 3494
Rory Murphy / Matthew Chandler
Arden Partners plc Tel: 020 7614 5900
Ruari McGirr / Elliot Mustoe (Corporate
Finance)
Simon Johnson (Corporate Broking)
Citigate Dewe Rogerson Tel: 020 7638 9571
Ellen Wilton
Dmitry Sazonenko, MSc Geology, MSc Petroleum Engineering, Member
of AAPG, SPE and EAGE, Director of the Company, has reviewed and
approved the technical information contained within this
announcement in his capacity as a qualified person, as required
under the AIM Rules.
Definitions
km(2) square kilometre
LPG liquefied petroleum gas
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