Eland Oil & Gas PLC (LON:ELA) shares edged higher on Thursday after the explorer told investors that the new Opuama-10 well in Nigeria, is now complete and is set to be handed over to the production team imminently.
Opuama-10 will shortly been tested for initial production rates, though Eland highlighted that it is expected to yield 4,000 to 6,000 barrels of oil per day, in line with expectations. It would bring field production to between 28,000 and 30,000 bopd.
That would give Eland’s Elcrest subsidiary between 1,800 and 2,700 bopd of additional production, taking its net production to between 12,600 and 13,500 bopd.
At the same time, it has now been decided that the Opuama-11 well will now be brought forward after Opuama-10 encountered six oil bearing reservoirs of which only two have been delivered into production.
“We are delighted that the recent successful infill drilling on Opuama field has led to the confirmation of a further near-term production well,” said George Maxwell, Eland chief executive.
“The successful delivery of Opuama-11 will not only advance us past our previous production target of 30,000 barrels of oil per day but will also maximise near-term cashflow.”
Opuama-11 will target intermediate reservoir zones not targeted by Opuama-10. This well - intended to develop the D3500, D4000 and D2000 reservoirs - is expected to yield gross production between 4,000 and 6,000 bopd (1,800 to 2,700 bopd gross to Elcrest).
After Opuama-11, the drill rig will move to the Gbetiokun field for the proposed re-entry of the Gbetiokun-1 and the drilling of new well, Gbetiokun-3.
Maxwell added: “The upside on OML 40 remains significant and together with Elcrest's partner NPDC we look forward to continuing the previously-announced work programme on the licence, including the Early Production System and Full Field Development of Gbetiokun field and exploration drilling of Amobe Prospect.
“I look forward to positively updating the market on operations in due course."
In mid-morning trading, Eland O&G shares were 0.4% higher at 117.5p.
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