07:00 Thu 02 Sep 2021
Empyrean Energy PLC - Award of Drilling Contract for Jade Prospect
This announcement contains inside information
Empyrean Energy Plc / Index: AIM / Epic: EME / Sector: Oil & Gas
Empyrean Energy plc
Block 29/11,
Empyrean Energy plc ("Empyrean" or the "Company"), the oil and gas development company with interests in
HIGHLIGHTS
· Award of IDC to COSL with targeted well spud date set for 15 December to
· Drilling rig availability confirmed and all technical, commercial and contractual terms agreed
· The final IDC requires a Drilling Program and Geological Program to be incorporated (underway) in the coming weeks
· COSL proposal includes a significantly reduced drilling cost estimate of
· Drilling Program, Geological Program, preparation for the Well Site Survey and preparation for various permits required to drill are all underway
Empyrean is the operator of Block 29/11 in
As part of the award process, the Company and COSL have agreed all technical, commercial and contractual terms and COSL has confirmed rig availability and a target spud date of 15 December to
As announced on
The Company had previously been quoted
The substantially reduced drilling contract quote has been reached without compromising the well design, safety or operational efficiency of the proposed well.
The Company is making good progress on other drill preparations including preparation of the Drilling Program, Geological Program, Well Site Survey and various pre-drilling permits.
The Company announced on
Further updates in relation to the finalisation of the IDC will be made in due course.
The Jade Prospect
The 2021 drilling campaign is targeting a world class conventional oil target in the Jade Prospect, to which Gaffney Cline & Associates ("GCA") assigned a Geological Chance of Success ("GCoS") of 32%. Subsequent to this independent assessment, the Company completed a gas cloud study and post stack seismic inversion study that it believes further mitigates risk and increases the GCoS to 41%.
The Jade Prospect has a GCA audited mean in place potential of 225 MMbbl and a P10 in place upside of 395 MMbbl. Four recent nearby discoveries by CNOOC immediately to the West of the Jade Prospect are filled to their P10 potential or better. All four CNOOC discoveries have gas clouds showing in the overburden on seismic.
Empyrean's excellent quality 3D seismic indicates that there is a classic "fill to spill" geological setup in the basin, and a robust regional seal, that provides the Jade and Topaz Prospects with a very real possibility of being filled in a similar fashion to nearby discoveries. The Jade and Topaz prospects have gas clouds, similar to nearby discoveries, in the overburden on 3D seismic. Dry wells nearby do not have gas clouds. The Jade Prospect is the first of the three identified prospects within Block 29/11, which also contains the Topaz and Pearl prospects. The combined audited mean in place potential of all three prospects is 884 MMbbl and a P10 in place upside of 1,588 MMbbl. The post stack seismic inversion study showed Jade and Topaz both have the potential for excellent carbonate buildup reservoir quality with excellent porosity and permeability. Any oil discovered is expected to be light oil in the 38-41 API range, similar to nearby discoveries. These attributes combined with the potential for exceptional natural reservoir drive supports the potential for excellent recovery rates.
The information contained in this announcement has been reviewed by Empyrean's Executive Technical director,
Empyrean CEO,
"This award of contract to COSL at approximately 34% below our previously anticipated drilling cost estimate is a massive leap forward for Empyrean and the reduced drilling cost is effectively better than a 34% JV style deal as there is zero dilution to Empyrean. The countdown to the drilling of the Jade prospect has begun. Locking in rig availability, finalising costs and setting a target spud date were all essential to securing the remaining funds required to drill the Jade Prospect whether that be by JV, warrant exercise or equity raise. The thorough work Empyrean has completed in conjunction with AGR resulting in the negotiation and award of contract is a credit to our technical director
For further information please contact the following:
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