Proactive Investors - Run By Investors For Investors

Block Energy making “excellent progress” as testing at West Rustavi continues

Block is targeting 325 bopd from well 16a at its flagship West Rustavi field, while it is also closing in on breakeven production at Norio
oil workers onshore drill rig
Schlumberger is drilling for oil in a field next to West Rustavi

Block Energy Plc (LON:BLOE) has made “excellent progress” in its quest to become Georgia’s leading independent oil and gas producer since it debuted on AIM last summer.

The company recently agreed to take 100% ownership of the West Rustavi field – its flagship asset with “company-making potential”.

READ: Block confirms significant oil and gas shows as West Rustavi drilling completes

West Rustavi has an estimated resource of 38mln barrels of oil and 608bn cubic feet (BCF) of gas. It is part of the same play being targeted by oil giant Schlumberger in a neighbouring field.

Block recently finished drilling well 16a which encountered “significant hydrocarbon shows”, which bodes well for the explorer to hit its target production rate of 325 barrels of oil per day (bopd) from the well.

Assuming a US$60 oil price, that initial rate of production would generate free cash flow of US$3.6mln per annum and pay back the well costs within six months.

Closing in on breakeven at Norio

Testing is ongoing at well 16a but Block is already gearing up to drill the nearby well 38, which is ready for re-entering and sidetracking.

Block is advancing the sidetrack campaign at West Rustavi in parallel with its ongoing multi-well workover programme at its Norio field, where it is incrementally increasing output from existing wells.

The company recently announced that production from Norio had increased four-fold to 60 bopd as it continues to move towards its breakeven production marker of 100 bopd.

First results as a listed company

For the half year to 31 December 2018, Block reported a net loss of £582,000 (H1 17: £416,000).

That was higher than the same period of last year due to an increase in business activities following the ramp-up of operations in Georgia during 2018.

The company incurred a net operating cash outflow of £462,000 (H1 17: £444,000) in the six month period. Cash stood at £1.98mln as of 31 December 2018 of (2017: £81,000).

View full BLOE profile View Profile

Block Energy PLC Timeline

Related Articles

oil rig
May 22 2019
Sidetrack at West Rutavi 16a flowed at 1,100 barrels per day against target of 650bopd for two wells
oil and gas operations
January 10 2019
The North Sea firm is working to bring the Liberator into development, and, with active operational plans and funding efforts appearing close to a conclusion it is set for a significant 2019.
Oil field
March 06 2019
The Woodrush field covers 13,000 acres and lies 65 miles north of oil and gas hub Fort St. John

© Proactive Investors 2019

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