Touchstone Exploration Inc (LON:TXP, CVE:TXP) this week confirmed an upgrade to its reserves in Trinidad following the unlocking of discoveries in the Ortoire licence block.
On Friday, the firm said proved (1P) reserves increased by 6% to 11.8mln barrels oil equivalent while proved and probable (2P) reserves increased 14% to 22.05mln barrels. The increase represents a 193% replacement of 2019’s production volumes, from the perspective of 1P reserves, while for 2P it was marked at 519%.
Consultant GLJ Petroleum, which authored the annual reserve report, valued the 1P reserve at US$83.7mln on the basis of a ‘10% discounted net present value of future net revenues’ valuation, whereas, for 2P reserves it set a value of US$153.9mln.
Also on Friday, in Argentina, Echo Energy PLC (LON:ECHO) said it has extended an existing £1mln loan and, amid weak crude prices triggered by coronavirus impacts, has also decided to seek an additional standby credit facility for up to a further £1mln.
In a statement, the company noted that production in Argentina remains in line with the board's expectations. Production from the acquired Santa Cruz Sur assets averaged 2,410 barrels oil equivalent (boe) per day in the month of February. For the period from 1 November to 29 February Echo had net production totalling 298,140 boe.
Last month, two oil cargoes were sold for a total of 33,424 barrels net to Echo with an average sale price of US$47.90 per barrel – which was a premium to prevailing local market prices.
SDX Energy PLC (LON:SDX) told investors this week that the BMK-1 exploration well in Morocco had encountered commercial quantities of gas in two targeted horizons.
It was described previously as a “play-opening” well and the result confirms that the core productive area in Morocco extends north, de-risking some 20bn cubic feet of prospective gas resources. The result is expected to significantly extend the life of resources.
BMK-1 was drilled down to a depth of 1,551 metres. It encountered the Upper Guebbas reservoir at a depth of 1,190 metres and the Lower Guebbas was found from 1,475 metres. Based on drilling data, the company estimated that there was a total of 0.9bn cubic feet in the Upper and Lower Guebbas targets, in line with pre-drill estimates.
"The BMK-1 result in Morocco is excellent news, confirming that together with the OYF-2 discovery in January, we can now plan to develop a material and valuable new prospective area to the north of our existing infrastructure in a market where we are the only gas producer and where we receive gas prices of between US$10-12 per mmcf,” said Mark Reid, SDX's chief executive.
Alaska explorer 88 Energy Ltd (LON:88E) confirmed on Tuesday that it had kicked off drilling at the Charlie-1 appraisal well on Alaska’s North Slope. The well programme is partnered with Premier Oil PLC (LON:PMO) which is largely funding the venture that aims to test a potentially significant discovery previously unearthed by BP back in the 1990's.
Malguk-1 was the original discovery well, with oil shows over multiple horizons, though it was not tested at the time due to complications at the end of the programme.
The Charlie well aims to intersect up to seven stacked prospects, which are together estimated to host some 1.6bn barrels of prospective resources. Premier is covering the well costs up to US$23mln, via a farm-out agreement.
The farm-out will provide US$7.5mln towards the cost of the NJPOM-3 well at Thali, which has an estimated total cost of US$15-16mln. Tower will also receive an overriding 10% royalty from the contractor's share of production to cover costs already sunk into the well, with the agreement expected to be signed off formally on 15 April.
Discussions are underway with several other parties regarding a farm-out of up to a further 24.5% interest in the Thali PSC on similar terms.
Jeremy Asher, Tower's Chairman and CEO, said: "We are delighted to have the opportunity to work with Greg Lee and Art Malone of OilLR on this project in addition to securing this funding for the well, and we intend to have the balance of the funding in place by the time this transaction completes.
Meanwhile, Solo Oil PLC's (LON:SOLO) proposed reverse takeover with ONE-Dyas gas has fallen through due to a failure to renegotiate terms after a slump in European gas prices. In addition, cost forecasts rose, while the share price was knocked by Brexit uncertainty.
Solo agreed in October to acquire a package of natural gas fields in the Dutch section of the North Sea from ONE-Dyas for €30.2mln upfront, €2mln deferred and partly funded by a £20mln equity raise.
Solo added it has enough cash to meet its commitments in Tanzania but has now set up a data room for anyone interested in acquiring its 25% stake in the Ruvuma PSC.
A formal sales process will start next week, with Solo, in the meantime, looking for another portfolio of European gas assets to acquire.