leadf
logo-loader
RNS
viewIGas Energy Plc

Igas Energy PLC - Waterflood Projects Update

RNS Number : 8138T
Igas Energy PLC
23 July 2020
 

23 July 2020

IGas Energy plc (AIM: IGAS)

 ("IGas" or "the Company")

 

Waterflood Projects Update

IGas is pleased to announce today that, in spite of the considerable challenges related to the Covid-19 pandemic, we have commenced water injection at our Scampton North site on schedule and on budget. As well as increasing oil production, the in-field pipeline and a new Separation facility at the Scampton North C-Site will provide greater efficiency and environmental improvements by reducing venting, the need to truck water to the Welton Gathering Centre, as well as increasing the amount of gas available for power generation. 

The DeGolyer & MacNaughton ("D&M"), CPR estimated 180 Mbbl of incremental 2P (Proved plus Probable Undeveloped) reserves and our mid-case economics for the project have an IRR of over 40% and a NPV of £2.5 million (which assumes a long-term oil price of $55/bbl).

Our second waterflood opportunity in the southern section of the Welton Field remains on track to be online late summer 2020. The Company's estimated base-case project economics have an IRR of over 100% and a NPV10 of c.£7.0 million (which assumes a long-term oil price of $55/bbl).

Commenting Stephen Bowler, Chief Executive Officer, said:

"This is an excellent operational achievement by the team against a difficult backdrop and is a material advancement in developing our 2P reserves.

 

Projects such as these provide strong economic returns even at these low oil prices, with environmental benefits, and continue to demonstrate the value of our producing and development assets.

 

The D&M valuation of our conventional assets is c. US$110 million on a 2P NPV10 basis with long-term oil price of c.US$50/bbl.

 

As the oil price improves, we will revisit our capital spending plans to accelerate projects with a high return on investment, demonstrating the flexibility that having the operatorship of our portfolio brings."

 

Ross Pearson, Technical Director of IGas Energy plc, and a qualified person as defined in the Guidance Note for Mining, Oil and Gas Companies, March 2006, of the London Stock Exchange, has reviewed and approved the technical information contained in this announcement. Mr Pearson has 19 years' oil and gas exploration and production experience. 

 

For further information please contact:

IGas Energy plc

Tel: +44 (0)20 7993 9899

Stephen Bowler, Chief Executive Officer

 

Ann-marie Wilkinson, Director of Corporate Affairs

 

 

 

Investec Bank plc (NOMAD and Joint Corporate Broker)

Tel: +44 (0)20 7597 5970

Sara Hale/Jeremy Ellis/Tejas Padalkar

 

 

 

BMO Capital Markets (Joint Corporate Broker)

Tel: +44 (0)20 7653 4000

Tom Rider/Neil Elliot

 

 

 

Canaccord Genuity (Joint Corporate Broker)

Tel: +44 (0)20 7523 8000

Henry Fitzgerald-O'Connor/James Asensio

 

 

 

Vigo Communications

Tel: +44 (0)20 7390 0230

Patrick d'Ancona/Chris McMahon 

 

 

 

 


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.
 
END
 
 
UPDUUVNRRSUBUAR

Quick facts: IGas Energy Plc

Price: 8.4936

Market: AIM
Market Cap: £10.48 m
Follow

Create your account: sign up and get ahead on news and events

NO INVESTMENT ADVICE

The Company is a publisher. You understand and agree that no content published on the Site constitutes a recommendation that any particular security, portfolio of securities, transaction, or investment strategy is...

FOR OUR FULL DISCLAIMER CLICK HERE

4 min read