Sign up United Kingdom
Proactive Investors - Run By Investors For Investors

Rose Petroleum investors boosted as new analysis sees 450mln barrels in Paradox basin

Chief executive Matthew Idiens described the initial seismic results as “a watershed moment” for Rose
oil and gas operations
Rose is now advancing its drill plans

Investors in Rose Petroleum PLC (LON:ROSE) have more details to pin their high hopes on after the explorer delivered hotly anticipated findings of recently shot 3D seismic.

Rose, on Monday, revealed new analysis of its Paradox basin acreage, in Utah, seeing the potential for some 450mln barrels to be present.

Specifically, the company has received the initial interpretation of new 3D seismic data for a 20 square mile area known as the Gunnison Valley Unit or GSU.

Chief executive Matthew Idiens described the initial seismic results as “a watershed moment” for Rose.

The process, which is ongoing, has identified some 53 potential well locations in the Cane Creek reservoir zone at the GSU, and the resource potential of those locations has been estimated.

Some 450mln barrels oil equivalent of mean unrisked and undiscovered original-hydrocarbon-in-place are estimated, with the prospective recoverable resource figure estimated at 32.5mln barrels oil equivalent.

Rose highlighted that the new estimates are consistent with prior assessments by independent consultants Ryder Scott back in 2014 (that report covered a larger 80 square mile area).

Ryder Scott at that time estimated the chance of success at 56% for the Cane Creek reservoir zone, describing the play as a ‘low risk prospect’.

Getting 'drill ready' in the Paradox

Rose is now working to upgrade certain areas so that they are ‘drill ready’, and, given that it set out to identify five initial well locations, the company ought to now have many options.

At the same time, the company is advancing applications for drilling permits and Rose said the first well could be drilled in the second half of this year.

“We believe this area represents a highly attractive drilling proposition, supported by excellent quality data that exhibits multiple drilling targets analogous to the structures of previously successful wells, to the south of our acreage,” Idiens said in a statement.

He added: “Negotiations with potential investors and partners to fund the drilling programme are ongoing, and the board will prioritise options, including joint venture and farm-in arrangements, to ensure that any dilution to existing shareholders is kept to an absolute minimum, while still realising the full value of the project.

“We will keep the market fully updated on what promises to be a very exciting period ahead for the company.”

Pointing to significant further upside, the company also noted that, in addition to the GSU, it has more than 100 square miles of acreage that is deemed prospective for the Cane Creek reservoir zone - there’s another 65 square miles of the Grand Main leasehold area and 48 square miles of the Emery Main leasehold area.

Long awaited gold disposal complete

The exciting progress in Utah comes as the company focusses more on oil and gas business, following the completion of a long worked on disposal of the group’s legacy Mexican gold operations in December.

The gold producing operation was sold to Magellan Gold Corporation (OTCQB:MAGE) in a deal worth a total of US$1.5mln, comprising US$1mln of cash and US$500,000 of shares (representing 15% of Magellan).

Idiens, at that time, said: "I am delighted that we have now completed the disposal of the SDA Mill.

"We now look forward to focusing our operational and strategic efforts on our oil and gas assets in the Paradox Basin, USA."

View full ROSE profile View Profile

Rose Petroleum PLC Timeline

Related Articles

picture of gas flare
February 13 2018
A new gas generator also came on stream recently and has started to produce the first power from the project
September 26 2018
The company expects its oil and gas exploration efforts will add to shareholder value.
oil and gas operations
September 05 2018
New exploration efforts are coming into the spotlight over the coming months as conventional drilling is slated for 2019

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 suitable or advisable for any specific person. You further understand that none of the information providers or their affiliates will advise you personally concerning the nature, potential, advisability, value or suitability of any particular security, portfolio of securities, transaction, investment strategy, or other matter.

You understand that the Site may contain opinions from time to time with regard to securities mentioned in other products, including company related products, and that those opinions may be different from those obtained by using another product related to the Company. You understand and agree that contributors may write about securities in which they or their firms have a position, and that they may trade such securities for their own account. In cases where the position is held at the time of publication and such position is known to the Company, appropriate disclosure is made. However, you understand and agree that at the time of any transaction that you make, one or more contributors may have a position in the securities written about. You understand that price and other data is supplied by sources believed to be reliable, that the calculations herein are made using such data, and that neither such data nor such calculations are guaranteed by these sources, the Company, the information providers or any other person or entity, and may not be complete or accurate.

From time to time, reference may be made in our marketing materials to prior articles and opinions we have published. These references may be selective, may reference only a portion of an article or recommendation, and are likely not to be current. As markets change continuously, previously published information and data may not be current and should not be relied upon.

© Proactive Investors 2018

Proactive Investors Limited, trading as “Proactiveinvestors United Kingdom”, is Authorised and regulated by the Financial Conduct Authority.
Registered in England with Company Registration number 05639690. Group VAT registration number 872070825 FCA Registration number 559082. You can contact us here.

Market Indices, Commodities and Regulatory News Headlines copyright © Morningstar. Data delayed 15 minutes unless otherwise indicated. Terms of use