TIDMSLE
RNS Number : 7483P
San Leon Energy PLC
21 August 2014
21 August 2014
San Leon Energy plc
("San Leon Energy" or "the Company")
San Leon Energy Update
San Leon Energy, the AIM listed company focused on oil and gas
exploration in Europe and North Africa, provides an update for the
following areas:
-- Palomar plans to spud a well on Rawicz in Q4 2014
-- New three-well drilling programme to begin in the Karpaty
area and Permian Basin, Poland; rig secured and first well to spud
in mid-September
-- The planned Lewino horizontal shale well in the Gdansk W
concession is in final engineering, awaiting the results of
ConocoPhilips/3Legs and BNK testing of similar wells in the Baltic
Basin
-- Timahdit oil shale in Morocco produced first oil during Enefit Bench Tests
-- The Nour prospect, offshore Morocco, targeting 300 MMboe, is
currently being drilled as announced on 31 July 2014
-- As part of its asset optimisation strategy, the Company has
exited Germany and Slovakia. In Poland, nine concessions have been
partly or fully relinquished, while the Company has also
relinquished the Tarfaya oil shale licence in Morocco, where the
Timahdit licence offers greater oil shale potential.
Palomar Partnership Assets:
Further to the announcement of the Palomar Natural Resources
Joint Venture on 1 July 2014, Palomar has now assumed day-to-day
running of the various joint operations. Palomar has established a
Warsaw office and several San Leon staff have moved to Palomar.
Palomar plans to spud a well on Rawicz in Q4 2014 and is actively
working up plans for the other areas of the joint venture.
New Three-Well Polish Drilling Programme:
The Company intends to drill two exploration wells in the
Karpaty area and one exploration well in the Permian Basin in
Poland during a single campaign using a rig from Exalo, beginning
in mid-September. All wells are relatively shallow and are in a
proven hydrocarbon trend area. All three wells are expected to be
completed before the end of the year:-
1. K ty, on the Bestwina concession in Karpaty, targeting gas in
Miocene sandstone with a 4 Bcf mid-case recoverable target. 60% San
Leon Energy (Operator), 40% PGNiG.
2. Giera towice on the Bielsko-Bia a concession in Karpaty,
targeting gas in the Upper Carboniferous sandstone primary target
and Lower Carboniferous limestone secondary target with a 4 Bcf
mid-case recoverable target. 60% San Leon Energy (Operator), 40%
PGNiG.
3. Niwiska, on Block 243 in the Permian Basin, targeting oil, in
the naturally-fractured Main Dolomite, with a 400,000 bbl mid-case
recoverable target plus some gas. San Leon Energy will operate the
well, and this drilling will fulfill the final stage of its
farm-in, leaving the equity split 50% San Leon Energy and 50%
Celtique Energy.
Lewino Horizontal (Baltic Basin, Poland):
The planned Lewino horizontal well in the Gdansk W shale gas
concession is in advanced engineering planning. Finalisation of the
well and frac design, and a decision to drill, will be taken
following analysis of results from the nearby ConocoPhilips/3Legs
and BNK wells. All operators in Poland share well results and
detailed drilling information to expedite the development of the
region's shale resource. We have seen very recent heightened
interest in farming in to the concession.
Oil Shale Sampling And Bench Testing, Morocco:
Surface and core sampling of oil shale from the Timahdit oil
shale project was completed earlier this year. These samples are
currently the subject of bench tests at the EOT/Enefit facility in
Frankfurt, Germany to confirm the quality of the various layers of
oil shale, and the oil yield possible from those layers.
Oil has successfully flowed from the Enefit retort process, and
while tests and analysis are ongoing, the initial results are very
encouraging. Final results will be utilised to update the project
feasibility study and enable consideration of the upgrading options
for the raw oil.
Asset Management:
Following technical work to appraise all licences as part of its
asset management strategy, the Company has:
-- Relinquished its licence in Germany
-- Made a decision to relinquish its assets in Italy
-- Sold its Slovakian subsidiary, Aurelian Oil & Gas
Slovakia ("AOGS") s.r.o to Discovery Polska LLP, a private Texas
based company. AOGS holds a fifty percent interest in the Svidnik,
Snina and Medzilaborce Concessions. San Leon received back
EUR153,054 in relation to costs incurred and an overriding royalty
interest equal to 3.5% of all hydrocarbons produced in the
concessions. Discovery Geo plan to drill two wells on these
concessions targeting shallow oil for early production
-- Relinquished its Tarfaya oil shale licence, onshore Morocco,
as the Timahdit oil shale licence is of significantly higher
quality
-- Relinquished all or part of nine Polish concessions (totaling
680,000 net acres, or 14% of the previous Polish total):
- Por ba
- Jordanów
- Mszana Dolna
- Kalisz
- Laski
- Wetlina
- Bielsko - Bia a (part, in progress)
- W grów
- Wieluń (part, in progress)
Oisin Fanning, San Leon Executive Chairman, commented:
"The Company continues to farm out assets and drill wells to
progress towards production and cash flow. Palomar are moving
quickly with a programme for developing the Rawicz field and
planning activity on other areas of the joint venture, and the
three-well drilling campaign in Karpaty and the Permian Basin is
part of our strategy to target early production. Planning is also
currently underway for our next Gdansk West well at Lewino, initial
results of the Conoco/3Legs and BNK horizontal wells appear
positive and further results are expected soon. Our Timahdit oil
shale project continues to show its long-term potential to generate
up to 11,000 bopd for 30 years and the current work is designed to
build the business case to attract capital investors. With the Nour
well, offshore Morocco, also currently being drilled, we are
excited by the potential for abundant newsflow and look forward to
updating the market in due course."
Qualified person
Joel Price, who has reviewed this update, has 20 years'
experience in the oil & gas industry and is a member of the
Society of Petroleum Engineers. He holds a BA in Natural Sciences
from Cambridge University, an MEng from Heriot-Watt University, and
an MBA from Durham University. Joel is Chief Operating Officer for
San Leon Energy and is based in San Leon's London office.
For further information contact:
San Leon Energy plc
Oisin Fanning, Executive
Chairman +353 1291 6292
finnCap Ltd
Corporate Finance
Matt Goode
Christopher Raggett
Corporate Broking
Elizabeth Johnson +44 (0) 20 7220
Joanna Weaving 0500
Fox-Davies Capital Limited
Daniel Fox-Davies
Oliver Stansfield +44 (0) 20 3463
Jonathan Evans 5000
Macquarie Capital (Europe)
Limited
Jon Fitzpatrick +44 (0) 20 3037
Nicholas Harland 2000
Westhouse Securities Ltd
Nominated Adviser
Richard Johnson +44 (0) 20 7601
Antonio Bossi 6100
Vigo Communications
Financial Public Relations
Patrick d'Ancona +44 (0) 20 7016
Chris McMahon 9573
Plunkett Public Relations
Sharon Plunkett +353 (0) 1 280 7873
www.sanleonenergy.com
This information is provided by RNS
The company news service from the London Stock Exchange
END
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