Pine Mills - Production Rates
7.00am 25 January 2021
Nostra Terra Oil and Gas Company Plc
("Nostra Terra" or "the Company")
Pine Mills - Production Rates
Nostra Terra (AIM: NTOG), the oil & gas exploration and production company with a portfolio of development and production assets in Texas, USA is pleased to announce production rates of the Cypress farm-out well at the Company's Pine Mills oil field.
In December the well was perforated in the target formation. Following this the well was swabbed to remove drilling fluids and relieve hydrostatic pressure. After successfully swabbing over a 48hr period oil was recovered at a rate of 15 barrels per hour.
In January the well was completed and put into continuous production. It is currently producing at a steady rate of 100 bopd, limited by pump capacity and surface equipment and with no water cut. While this rate is above expectations, given the strong performance the operator will review seeking authorisation to increase production further. NTOG have a 32.5% working interest in this well (32.5 bopd before royalties) and any future wells in the farm-out area.
Given the positive result of this well, the Company expects an increase in its proven reserves. The Company hasn't previously booked any reserves for this acreage or any of the additional undrilled acreage on its Pine Mills oil field. The technical team is currently reviewing seismic data and logs to select the next two drilling locations. When the tank battery was built for the current well, two additional 400-barrel tanks were added to facilitate future production.
This area benefits from conventional clastic reservoirs which typically have shallow, predictable declines and long-life production profiles and reserves. Operationally the wells and completions are relatively simple, minimising well intervention costs and reducing opex to a level where we anticipate lifting costs of less than $10/bbl.
Further updates will follow regarding reserves and operations.
Matt Lofgran , Nostra Terra's Chief Executive Officer, said:
"Pine Mills has proven to be a great asset for Nostra Terra. While we retain 100% working interest on the majority of the acreage, this 80-acre farmout with Cypress has been very successful for all parties involved. Cypress has been a great partner and we look forward to a continued relationship. The success goes beyond the single well, with the potential for further opportunities in the area, and proves up additional reserves in a low-risk development.
The well was being planned and permitted when oil was circa $40 per barrel (WTI). With oil prices now above $50 and lifting costs in the single digits the production will have a positive impact on the Company. A great start to 2021 as we plan to build from here."
This announcement contains inside information for the purposes of Article 7 of EU Regulation 596/2014
Competent Person Disclosure
John Stafford, a Director at Nostra Terra with over 35 years' relevant experience in the oil industry, has reviewed this announcement for the purposes of the current Guidance Note for Mining, Oil and Gas Companies issued by the London Stock Exchange in June 2009. Mr. Stafford is a Fellow of the Geological Society and a member of the Petroleum Exploration Society of Great Britain.
For further information, contact:
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Nostra Terra Oil and Gas Company plc Matt Lofgran, CEO
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Email: |
+1 480 993 8933 |
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Beaumont Cornish Limited (Nominated Adviser) James Biddle/ Roland Cornish
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Tel: |
+44 (0) 20 7628 3396 |
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Novum Securities Limited (Broker) Jon Belliss
Lionsgate Communications (Public Relations) Jonathan Charles |
Tel:
Tel: |
+44 (0) 207 399 9425
+44 (0) 7791 892509
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