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Eland Oil & Gas shares advance on Opuama well update

Published: 15:40 25 Apr 2016 BST

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Combined flow equated to 10,584 bopd.

Eland Oil & Gas Plc (LON:ELA) shares advanced around 17% after an update on the Opuama-3 well, in Nigeria, where production has improved.

The company said that work with a production logging tool (PLT) has identified that water ingress in the well was coming from the lower D5000 producing interval, and that the reservoir had been isolated.

Production strings were set up into the D1000 and the D2000 reservoirs, with both strings producing into storage and the flow rates would be tested.

The D2000 reservoir tested at a rate of 1,137 barrels of oil over a 6 hour period, which extrapolates to 4,548 bopd, while the D1000 flowed 235 barrels over an hour which extrapolates to a rate of 5,640 bopd.

Combined flow was tested at 441 barrels over an hour period, which extrapolates to 10,584 bopd.

Eland highlighted that 1,000 barrels of water production from the well as a result of the cement job, and has significantly reduced the well’s water cut.

It added that the Forcados terminal oil terminal is expected within a month, and after that it expects to recommence production.

“We are very pleased to announce the successful completion of the Opuama-3 re-entry and the strong results from flow testing the well,” said George Maxwell, Eland chief executive.

“The results are beyond the high end of our previously announced expected range of 2,000-4,000 incremental gross barrels of oil produced per day.

“The two newly perforated reservoirs have proven to be highly productive.”

He added: “Our current plan is to commence operations on this high quality asset in the second half of the year, and we anticipate that a successful workover will lead to our current forecast of gross production in the range of 5,000-10,000 barrels of oil per day from the Gbetiokun-1 well."

Eland shares gained 5.75p, 17.04%, to trade at 39.5p.

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