30 April 2021
PRESIDENT ENERGY PLC
("President" or the "Company")
President Energy (AIM: PPC), the energy company with a diverse portfolio of production and exploration assets focused primarily in South America, provides an operational update with regard to certain activities in the Rio Negro Province, Argentina
· Gas well LB-1002, Las Bases field successfully completed with initial production levels 30% better than anticipated
· New gas well EV-1002 spudded
· New gas well EV-1001 to be completed and projected to be placed on stream within 14 days
Following the drilling of the gas well LB-1002 in the Las Bases field, the first of the current three well campaign, the well has now been successfully completed with a total perforated interval of 5 metres (16 feet) in the lower Centenario 5 and 6 intervals without any form of stimulation. These intervals were not in the primary target, nor expected to be productive at the time of well planning and is therefore somewhat of a bonus.
The well was produced on test with an 8mm choke. Production was stable at some 55,000 m3/d of gas (1.94 MMsft/d or circa 323 boepd) versus pre-drill and post-drill estimates of 40,000 m3/d, a 30% increase. Pressure remained robust through the test with no formation water identified. It is expected that the well will be producing on stream by the end of next week.
Remaining to be tested is the main target, a known productive and thicker pay interval higher up the hole, the Centenario 3 section. President will first produce from the current intervals being the Centenario 5 and 6 sections and use the data for further consideration of the Las Bases field.
By illustration only, to place the financial benefit of the current production in context, using the prevailing spot gas price of US$4 MMBtu, the income net to President per month after relevant opex on the assumption of the tested production levels continuing would run at US$200k per month.
New well EV-1002
This well has now spudded. Estimated time to drill, log and case the well is 15 days from now.
By way of reminder, this well is designed as a twin well of the formerly producing gas well EV-4 which was drilled in 1989 and which ceased production in 2019 due to a casing collapse.
Pre-drill estimates of initial production in the success case are similar to the just drilled well EV-1001 namely 60,000 m3/d (2.1 MMscft/d or 350 boepd).
New well EV-1001
The coiled tubing unit and ancillary test and stimulation equipment to complete this well and place it on production is now mobilising to location from the LB-1002 site. It is projected that subject to successful completion this well, the second in the current drilling campaign, will be placed on stream within 14 days.
Peter Levine, Chairman, commented
"There is understandably significant investor interest in the progress of the much discussed exploration farm-out in Paraguay in respect of which I continue to urge patience reflecting the multi-stage signing authority process required by a rigidly structured state energy company.
"However, in that context it is important to keep in mind we are relative to our size a significant and successful operational company. Such continued progress in the field once again demonstrated by this announcement. We do not take each progression in operations on the ground as some side show to be taken for granted and ignored. Each step has challenges to navigate.
"Exciting and potentially transformational exploration is great and of value to have in our portfolio but it is this progress and the hard work of our people on the ground that will deliver a substantial improvement in the financial position and prospects of President, 2021 compared with last year"
Bopd means barrels of oil per day
Boepd means barrels of oil and gas equivalent
MMBtu means million standard cubic feet of gas
Mmsft/d means Million standard cubic feet of gas per day
M3/d means million of cubic metres of gas per day
President Energy PLC
Nikita Levine, Investor Relations
+44 (0) 207 016 7950
finnCap (Nominated Advisor and broker)
Christopher Raggett, Tim Harper
+44 (0) 207 220 0500
Notes to Editors
President Energy is an oil and gas company listed on the AIM market of the London Stock Exchange (PPC.L) primarily focused in Argentina, with a diverse portfolio of operated onshore producing and exploration assets.
The Company has operated interests in the Puesto Flores, Estancia Vieja, Puesto Prado and Las Bases Concessions, and Angostura exploration contract, all of which are situated in the Rio Negro Province in the Neuquén Basin of Argentina and in the Puesto Guardian Concession, in the Noroeste Basin in NW Argentina. Alongside this, President Energy has cash generative production assets in Louisiana, USA and further significant exploration and development opportunities through its acreage in Paraguay and Argentina.
The Group is also actively pursuing value accretive acquisitions of high-quality production and development assets capable of delivering positive cash flows and shareholder returns. With a strong strategic and institutional base of support, including the international commodity trader and logistics company Trafigura, an in-country management team as well as the Chairman whose interests as the largest shareholder are aligned to those of its shareholders, President Energy gives UK investors access to an energy growth story combined with world class standards of corporate governance, environmental and social responsibility.
This announcement contains inside information for the purposes of article 7 of Regulation 596/2014