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Block Energy PLC - West Rustavi EPF Update and Appointment of EPI

RNS Number : 3019Q
Block Energy PLC
18 June 2020
 

18 June 2020

 

Block Energy plc

("Block Energy", "Block" or the "Company")

 

West Rustavi Early Production Facility Update and Appointment of EPI

 

Block Energy Plc, the exploration and production company focused on Georgia, is pleased to issue an update on the progress of its West Rustavi Early Production Facility ("EPF"), the re-opening of Georgia's borders, the Company's operations and the engagement of EPI Limited ("EPI"), a leading independent geoscience and geophysical consultancy.

 

Block Energy's EPF, a key component in enabling the Company to process and sell gas from its West Rustavi field, has arrived on site from Canada. The EPF comprises an inlet manifold for six wells, separators and a gas dehydration and measuring unit. As previously announced, gas sales are forecast to commence during H2 2020, once the WR-16aZ and WR-38 wells have been tied into the inlet manifold and the gas sales pipeline has been installed.

 

In relation to the Covid-19 pandemic, Georgia is beginning a phased approach to returning to business, with restrictive measures having been relaxed for its citizens. The re-opening of borders to allow foreign travellers to enter the country is expected in July. As at 17 June 2020, Covid-19 cases in Georgia numbered 888 and 14 deaths were associated with the virus. There have been no Covid-19 cases at the Company's operations. Block's wells at West Rustavi remain shut in, as announced on 7 April 2020, and the Group's employees continue to sacrifice 40% of their cash salary, taking a deferred cash payment or share options instead.

 

Block is delighted to announce the engagement of EPI, whose expertise encompasses geophysical and geological interpretation, petrophysics and reservoir engineering. It is intended that EPI will add significant value and technical discipline to Block's oil and gas future development programmes. The specific service is the provision of an outsourced sub-surface reservoir development department, fully integrated into the Block organisation within an innovative strategic partnership. EPI has an exceptional track record for quality, innovation and success, working with small independents, supermajors and national oil companies in over 90 countries.

 

Block now has an even more exciting portfolio of assets to evaluate and EPI will be part of the team defining new development well activity in our existing fields, such as West Rustavi, and in our soon-to-be-acquired assets within the Block XIB area. In particular, Block sees significant potential for the horizontal side-tracking of existing wells, including the appraisal of the PAT-E1 gas discovery drilled by Schlumberger in 2019. EPI will bring their expertise to the analysis of the geological aspects of horizontal well design and the selection and ranking of previously identified opportunities in Block XIB, where over 180MMbbls of oil have been produced, with a peak production rate of 67,000 barrels of oil equivalent per day.

 

As Block Energy's current focus is on balance sheet management and cash conservation, the engagement is structured to share risk and reward, partly tied to drilling performance and well productivity. EPI's commitment to Block further underlines today's value proposition and integrating EPI into the Company has already begun.

 

Block Energy Chief Executive Officer Paul Haywood said:

"The Block team remains enthusiastically active on many fronts. I am pleased to report the arrival of our West Rustavi Early Production Facility in the field getting us closer to achieving gas sales, a significant milestone for the Company. It is also welcome news that Georgia is easing the Covid-19 restrictions and is forecast to re-open its borders in July.

 

"We are delighted to welcome the EPI team, whose engagement expresses a strong vote of confidence in our Company's asset base. Their expertise will immediately strengthen our current workstreams, whilst defining our next phase of development. Our Georgian portfolio is an undervalued resource base. The newly-formed relationship with EPI will significantly augment our technical capability and enhance the group's ability to define the optimum development programme for the soon-to-be-acquired XIB asset."

 

For further information please visit http://www.blockenergy.co.uk/ or contact:

Paul Haywood

(Chief Executive Officer)

Block Energy Plc

Tel: +44 (0)20 3980 6250

Neil Baldwin

(Nominated Adviser)

SPARK Advisory Partners Limited

Tel: +44 (0)20 3368 3554

Peter Krens

(Corporate Broker)

Mirabaud Securities Limited

Tel: +44 (0)20 3167 7221

Billy Clegg / Owen Roberts / Violet Wilson

(Financial PR)

Camarco

Tel: +44 (0)20 3757 4980

 

Notes to editors

Block Energy is an AIM-listed independent oil and gas company focused on production and development in Georgia, applying innovative technology to realise the full potential of previously discovered fields.

The Company has a 100% working interest in the highly prospective West Rustavi onshore oil and gas field with multiple wells that have tested oil and gas from a range of geological horizons. The Field has so far produced 50 Mbbls of light sweet crude, and has 0.9 MMbbls of gross 2P oil reserves in the Middle Eocene. It also has 38 MMbbls of gross unrisked 2C contingent resources of oil and 608 BCF of gross unrisked 2C contingent resources of gas in the Middle, Upper and Lower Eocene formations (Source: CPR Gustavson Associates: 1 January 2018).

Block Energy also holds 100% and 90% working interests in the onshore oil producing Norio and Satskhenisi fields. It has recently entered into a conditional sale and purchase agreement for Georgian onshore Blocks XIB and IX.

The Company offers a clear entry point for investors to gain exposure to Georgia's growing economy and the strong regional demand for oil and gas.


This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact [email protected] or visit www.rns.com.
 
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