Receipt of Final FEED Study and Third-Party Report

RNS Number : 5263G
TomCo Energy PLC
27 July 2021
 

27 July 2021

 

TOMCO ENERGY PLC

("TomCo" or the "Company")

 

Receipt of Final FEED Study and Third-Party Technical Evaluation Report

 

 

TomCo Energy plc (AIM: TOM), the US operating oil development group focused on using innovative technology to unlock unconventional hydrocarbon resources, is pleased to announce that   Greenfield Energy LLC ("Greenfield"), the Company's 50/50 joint venture with Valkor LLC ("Valkor"), has now received the finalised FEED (Front-End Engineering and Design) study for production facilities, together with the associated third-party technical verification report on the proposed process, commissioned from Crosstrails Engineering LLC ("Crosstrails") and Kahuna Ventures LLC ("Kahuna") respectively .

 

Highlights

 

· FEED study updated and finalised to reflect, inter alia, Greenfield's potential acquisition of up to 100% of the ownership and membership rights and interests in Tar Sands Holdings II LLC ("TSH II") for the potential future mining of oil sands and construction, subject to funding, of an initial commercial scale processing plant, as outlined in the Company's announcement of 9 June 2021.

· The proposed plant is planned to consist of an initial 5,000 barrels of oil per day ("bopd") train but configured for possible expansion to 10,000 bopd via a second future train, with a total capital cost for the 5,000 bopd train estimated at US$110 million.

· Subject to securing TSH II, which owns a suitable site in Uintah County, Utah, USA, and the requisite funding, the overall engineering, procurement and construction ("EPC") phases of the project are forecast to take 54-62 weeks, barring any significant supply chain issues or adverse weather conditions during construction and commissioning.

· Third-party technical verification report by Kahuna involving a site visit to Petroteq Energy Inc's ("Petroteq") pilot plant and review of operating data, process simulation data and the FEED study, supports, inter alia, indicative operating costs of approximately US$22 per barrel of oil produced for a 5,000 bopd plant operating 24 hours a day, 360 days a year, before corporate costs, SG&A costs and royalty fees. Such estimated operating costs are deemed by Kahuna to be based on valid assumptions and in line with industry norms.

· Greenfield is currently focused on completing the requisite due diligence on TSH II and its site in Utah, whilst also seeking to put in place the necessary funding package, as announced on 9 June 2021.

 

Further information on the FEED Study

 

As previously announced, Greenfield engaged Crosstrails, a Valkor company, to develop a FEED study for the production facilities for a 5,000 bopd oil sands project (the "Greenfield Plant").  The Greenfield Plant is currently intended to be located on a site to the west side of Vernal, Utah owned by TSH II as further detailed in the Company's announcement of 9 June 2021.  The proposed plant is planned to consist of an initial 5,000 bopd train but configured for possible expansion to 10,000 bopd via a second future train. 

 

The plant design will be configured to accept ground oil sands ore, available from the TSH II site, for loading into a closed loop process.  The ore will be mixed with solvent in a continuous feed process and the sand will then be separated and dried with the vapor recovered in the backend. The liquid portion will be processed to remove the balance of solids and then the solvent will be recovered in the backend along with the other vapor.  The final products of the proposed plant are designed to be sales oil, raw bitumen and a small diesel fraction, together with sand that meets the State of Utah's Department of Environmental Quality's Tier 1 Screening Levels.

 

The FEED study describes the design data, design requirements and general operating philosophies for the development of the plant, including a Class 3 (± 25%) cost estimate of approximately US$110 million, the detailed equipment requirements and the estimated timeline to deliver the project.

 

The finalised FEED study will be utilised as the basis for the EPC phase of the project and TomCo's directors believe that the completed FEED study, together with the supporting third-party technical verification report and recently completed testing operations at Petroteq's pilot oil separation plant, serve to provide a high level of confidence in both the potential economics and the technical feasibility of Greenfield's plans.

 

Commenting, John Potter, CEO of TomCo, said : "I am delighted the finalised FEED study has now been received, together with the associated third-party technical verification report.  The FEED study outlines better economics for the proposed plant than we initially envisaged, together with verification that the proposed technical approach is appropriate.

 

"Greenfield's focus remains firmly on completing the requisite due diligence on TSH II and its site in Utah and progressing the necessary funding package in order to, inter alia, pursue construction of an initial 5,000 bopd facility at the earliest opportunity.  These are very exciting times for TomCo as we look to realise Greenfield's significant potential."

 

The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulation (EU) No. 596/2014 as it forms part of United Kingdom domestic law by virtue of the European Union (Withdrawal) Act 2018.

 

Enquiries :

 

TomCo Energy plc

Malcolm Groat (Chairman) / John Potter (CEO)                     +44 (0)20 3823 3635

 

Strand Hanson Limited (Nominated Adviser)

James Harris / Matthew Chandler                                             +44 (0)20 7409 3494

 

Novum Securities Limited (Broker)

Jon Belliss / Colin Rowbury    +44 (0)20 7399 9402

 

IFC Advisory Limited (Financial PR)

Tim Metcalfe / Graham Herring                                                  +44 (0)20 3934 6630

 

For further information, please visit www.tomcoenergy.com .

 

About Kahuna

 

Kahuna, founded in 1999, is an energy focused project execution firm consisting of process, mechanical, electrical, and civil/structural engineering personnel with supporting 3D design/drafting, advanced modelling, facility documentation, and environmental/safety compliance services.  Kahuna's team brings decades of successful experience in the energy Industry and has established a strong culture dedicated to quality workmanship and delivering superior products and services tailored to each client's specific needs. Kahuna represents clients' interests by providing on-time engineering, project execution, and commissioning services.

 

For further information see: www.kahunausa.com

 

 

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