Mosman Oil and Gas Ltd (AIM:MSMN) has confirmed a significant increase in reserves at the Cinnabar project, in Texas, where it recently drilled a well.
The company, in a statement, said that following the successful development drilling of and production from the Cinnabar-1 well it has updated the field’s reserves report, resulting in a 78% increase in proved volumes.
"We are extremely pleased with the new Reserve Report that confirms significant quantities of Reserves at Cinnabar,” Mosman chair John Barr in the statement. "Cinnabar is now the most significant project in Mosman's portfolio both in terms of production and reserves."
Mosman said total proved reserves now total 1.58mln barrels at the project – comprising 1.13mln barrels of proved undeveloped reserves, 302,000 barrels designated as proved developed and producing, and 147,000 barrels designated as proved developed and ‘behind the pipe’.
Cinnabar also has some 65,000 barrels of probable reserves, taking the tally of proved and probable reserves to 1.64mln barrels.
Mosman noted that its reserves are based on the assumption of a further five-well development at Cinnabar including one new well in 2023, two new wells in 2024 and two more in 2025. It said such a development remains subject to a number of matters including board approval and funding availability.
"The board can now consider the best way to commercialise these reserves," Barr added.
Mosman retains a 97% working interest in the Cinnabar project.