23rd Sep 2019 14:21
(Alliance News) - Oil & gas investment firm Reabold Resources PLC on Monday said flow rates at the Burnett 2B well in California were higher than expected, and work is underway to increase the capacity of its production facilities.
Providing an operational update on its Californian assets, Reabold said the Burnett 2B well, in the 50%-owned Monroe Swell discovery, had a flow rate of 40 barrels of oil per day.
Monroe Swell's current production facilities are "insufficient", to deal with the flow rate, Reabold said. Work to increase the capacity is expected to be completed in the "next two or three weeks".
Also in California is the West Brentwood licence, in which Reabold has a 50% stake. Following "favourable economic returns", Reabold and its partners will drill a third well at the project. Drilling for VG-5 well is expected to take place in the fourth quarter of 2019.
The company however has postponed drilling of a well at Grizzly Island, which in April it said was "planned for later this year".
Reabold said it is prioritising VG-5 and drilling Grizzly Island has been pushed back to 2020.
Co-Chief Executive Stephen Williams said: "Our Californian assets continue to exceed our expectations, with the higher-than-expected flow rates at Burnett 2B generating more valuable cash for Reabold.
"We continue to be excited by the significant running room on the licences, particularly given the high-margin production in California, and we look forward to future drilling across Monroe Swell, West Brentwood and Grizzly Island."
Shares in Reabold were 3.6% lower at 1.16 pence each in London on Monday afternoon.
By Eric Cunha; [email protected]
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