1st Oct 2009 07:00
ENEGI OIL PLC
Trading symbols:
London Stock Exchange: ENEG
Bourse de Luxembourg: GB00B29T9605
1 October 2009
Enegi Oil Plc
('Enegi' or 'the Company')
Resumption of Operations
Enegi today announces that its wholly owned subsidiary, PDI Production Inc ("PDIP"), intends to resume operations at the PaP#1-ST#3 well at Garden Hill South within the coming weeks.
On 3 January 2009, the PAP#1-ST#3 well was brought on line for clean up prior to undertaking a flow test. The well was choked back to assist in the clean up and initially flowed at 500 bopd and 1,690 mscf per day. However, the wellbore pressure and flow rates subsequently declined. The well was subsequently shut in as the well was unable to sustain continuous production and also due to the high costs of operating during winter conditions; which made further operations uneconomic at that time. Over the three week period that the well was online 6,146 barrels of high quality 51o API crude oil and 3,100 boe of sweet gas were produced.
The wellbore pressure has since recovered to levels similar to those before the well was brought on line. The performance of the well indicates that it is in contact with a large volume of oil but that the connectivity to the wellbore is poor. The data also indicates that the well is capable of producing on an interval basis, whereby the well may be flowed, then shut-in, to recharge the in-contact reservoir pressure, before repeating the process.
It is now the intention to flow the well on an interval basis when operating costs would be low enough and flow rates high enough for the operation to be economic. In addition to giving PDIP revenue, flowing the well will also:
provide an understanding of how the well performs in periods where heating the annulus is less critical;
provide an opportunity to purge approximately 50m3 of water that was not flowed out when the well was on line in January. If purged, flow rates may improve as a result of improved connectivity to zones near the toe of the well; and
provide more data on how the wellbore pressure declines and recharges over time.
Alan Minty, CEO of Enegi Oil commented:
"We are delighted to re-commence operations. When we originally drilled the well earlier this year the prevalent conditions and high costs associated with winter operations made the well uneconomic at that time. Flowing the well now will not only provide us with some revenues, but will also provide further technical information about the well."
Enegi Oil Tel: + 44 161 817 7460
Alan Minty, CEO
Cenkos Securities Tel: + 44 207 397 8900
Joe Nally
Stephen Keys
College Hill Tel: + 44 207 457 2020
Nick Elwes
www.enegioil.com
Qualified Persons
The information in this release has been reviewed by Barath Rajgopaul MSc (Mech. Eng.) C. Eng, a director of Enegi. Mr. Rajgopaul has over 25 years experience in the petroleum industry.
The Company
Enegi Oil Plc is an independent oil and gas group whose objective is the identification, development and operation of hydrocarbon opportunities. The Group's current operations are focused on assets on and around the Port au Port Peninsula in Newfoundland, which, although lightly explored, is in an active petroleum system with light oil having previously been discovered there. The Group's assets include Garden Hill South, Shoal Point, Garden Hill Central, Garden Hill North and Lourdes.
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