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Enegi Oil Plc is an independent oil and gas company. Current operations are focused on opportunities around the Port au Port Peninsula in Newfoundland, Canada and the Clare Basin in County Clare, Ireland.
The Port au Port Peninsula is located in western Newfoundland, which, although lightly explored, is in an active petroleum...Read more
ENEGI OIL renews Garden Hill South production licenceAugust 13 2012, 12:51pm
ENEGI Oil (LON:ENEG) this afternoon told investors that it has been granted a 5 year renewal over part of the Garden Hill South production area.
However, it is has to relinquish some of its acreage. It will currently retain 16 square kilometres of the previous 158.8 square kilometre area. This does not affect the current operations at the project.
"We are pleased that we have secured a 5 year renewal over an area that incorporates the PAP#1 ST#3 well which will allow the Company to continue to progress its current operations,” said chief executive Alan Minty.
The Canadian regulations state that an operator must relinquish land that, based on existing data, is not lying over whole or part of a petroleum pool, or are not required for injection wells or for the efficient development, conservation and production, ENEG explained.
But ENEGI believes that the Garden Hill South is larger than previously anticipated, in the 2007 competent persons report. And this assertion is backed up by independently produced resource models earlier this year.
ENEGI says that the area covered by the new lease renewal is inconsistent with the models that it believes ‘best represents’ the geology of the former lease area. It therefore says it will ‘seek to understand’ the authorities model of the area before it decides how to proceed.
“The land relinquished on PL2002-01 represents only a small proportion of Enegi's overall land position and potential in western Newfoundland and we will push ahead with our modelling and planning of future activities,” Minty added.
In May, ENEGI released the findings of the independent assessment by McCaffrey Consulting Services.
The assessment concluded that the PaP#1-ST#3 had yet to see pressure depletion and this suggested the reservoir is larger than first estimated. This also has knock-on implications for daily flow rates, which were also expected to increase.
The 2007 competent persons report suggested GHS estimated there were 61.5 million barrels of oil in place as well as 117 BCF of gas.