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US Oil & Gas ponders how to deal with volcanic ash at Eblana

Off the six zones encountered, zone 5 was the most promising but oil flow from here was being hindered by volcanic ash and tuff.

US Oil & Gas is having to clear debris from the well

US Oil and Gas PLC is attempting to clear volcanic debris from its Eblana-3 well in Nevada to establish a sustained oil flow.

In August, US Oil and Gas said hydrocarbon had flowed to surface from the well but today added that subsequent testing failed to sustain this consistently.

Off the six zones encountered, zone 5 was the most promising but oil flow from here was being hindered by volcanic ash and tuff.

The plan is to clear the zone by extended pumping.

If the well flows, production testing will be carried out.

If pumping fails to clear the formation, US Oil & Gas may frack to stimulate production if data indicates a viable reservoir is present.

The company added it had been awarded more acreage in the Hot Creek Valley, which has increased its total acreage 73,725 acres. The total annual lease cost is now $78,000.  

Brian McDonnell, US Oil’s chief executive, said: “High quality light oil has flowed to the surface from Eblana-3, and our preliminary testing has identified a highly promising and potentially productive zone.

“However, the nature of the Hot Creek Valley geology is posing challenges, and before any production testing can be carried out, we need to determine how best to deal with volcanic ash and tuff.”

Shares in US Oil & Gas are currently not listed on any recognised exchange.

Today, the company said it intends to hold its AGM as soon as possible.

Shareholders will be advised of the details as soon as arrangements can be finalised, it added.

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