Diversified Gas & Oil plc (LON:DGOC) was a strong gainer this week after a batch of news. On Friday it confirmed the completion of its latest transformational acquisition, buying producing wells and midstream infrastructure in the Appalachian Basin.
The US$575mln deal more than doubles the group’s output, daily production rates are set to increase by 115% to over 60,000 barrels of oil equivalent per day.
It was paid for via the company’s cash resources, supported by a US$240mln equity raise, and, an expanded revolving credit facility - which runs up to US$1bn, with a current borrowing base of US$600mln.
Rusty Hutson, DGOC chief executive, said: “The addition of these high-quality assets to our growing portfolio and their accretive impact on earnings are tangible results that benefit our shareholders and represent a significant milestone in the evolution of our clearly stated strategy.”
Horse Hill sees strong start to testing
The first batch of production testing results from the Horse Hill project has boosted the small-cap companies invested in the UK oil project. Initial oil flows from the conventional Portland reservoir are described as being equal to or exceeding the past results from the 2016 test programme.
The highest observed hourly rate was said to be equivalent to 352 barrels of oil per day, but, in a series of stock market statements revealed that the oil flows have not yet been optimised for maximum sustainable flow rates.
Based on the initial analysis, it was stated that the well’s productivity is unaffected by two-year shut-in period since 2016.
It was good news for UK Oil & Gas Investments PLC (LON:UKOG), Solo Oil PLC (LON:SOLO), Alba Minerals PLC (LON:ALBA) - all of which are stakeholders in the project.
SDX Energy lands new Morocco funds
SDX Energy Inc (LON:SDX) (CVE:SDX), on Wednesday, told investors that it is due to sign a three-year, US$10mln credit facility with the European Bank for Reconstruction and Development (EBRD) with the funds earmarked for its assets in Morocco.
It will be an initial US$10mln facility, though it will have an ‘accordion’ feature allowing for up to US$20mln of total funds availability.
Earlier in the week, the company confirmed that the SD-4X appraisal well, at the South Disouq project, had been a success.
The well flowed at a maximum rate of 30.4mln standard cubic feet per day (MMscfd) during an eight-hour cleanup period and was then shut in for a further eight hours, during which time no pressure decline was observed.
Following this, by varying choke sizes the well flowed for two successive 12-hour periods at average rates of 5.4 MMscfd, 8.6 MMscfd respectively and one extended flow period of 24-hours at an average rate of 10.5 MMscfd.
During the production testing, a total of 23.38 MMscf of conventional natural gas was produced from SD-4X.
“We are very pleased to report another successful production test result, at our SD-4X appraisal well in South Disouq,” said president and chief executive Paul Welch.
New insights for Dunquin exploration
Providence Resources PLC (LON:PVR) has detailed encouraging technical insights regarding the large Dunquin South prospect, in the Porcupine basin, offshore Ireland. It follows the completion of the initial evaluation of new 3D seismic, shot last year, which has improved the explorer’s understanding of the area.
Firstly, the data confirms the presence of the previously mapped Dunquin South prospect which is located in the vicinity of the previously drilled Dunquin North well (which encountered evidence of a residual oil column but was not a ‘discovery’).
Perhaps more significant is that the new seismic has shown what Providence described as “a large and significant potential fluid escape feature” evident at Dunquin North, but, no such feature is visible at the untested Dunquin South target.
"The new 3D seismic data over FEL 3/04 are greatly enhancing our understanding of the exciting exploration potential of this block,” said Dr John O’Sullivan, Providence technical director.
Highlands - six well drilling complete
Highlands Natural Resources Plc (LON:HNR) told investors that its six-well drilling campaign at the East Denver project has now been completed successfully. The programme has been entirely funded by its partners and all six wells have now been cased, cemented and secured. Next, the well pad is being prepared for upcoming fracking and flow back operations.
The company previously guided that the fracking phase would take between 7 and 10 days per well.
Work started on the series of wells – named Buckskin, Citadel, Hagar, Ouray, Thunder and Grizzly – back in April.
Mosman production growth
On Tuesday, Mosman Oil And Gas Limited (LON:MSMN) saw its shares jump after reporting an almost 200% increase in sales revenue in the six months to 30 June 2018.
In a production update for the period, the AIM-listed oiler reported sales revenue of US$534,000, a 191% increase on the previous six month period, while net production attributable to the company increased 35% to 4,417 barrel of oil equivalent (boe).
The company added that total gross production across all of its underlying acreage on a total project basis was 12,260 boe over the period, a 28% increase on the prior period.
Then, by Friday, the company updated investors on the Stanley-1 well which continues to be drilled.
The company told investors that drilling began on Thursday and it expects the planned depth of 7,000 feet will be reached within the next two weeks.