Operations Update: Production Enhancement Plan
10 November 2022
Echo Energy plc
("Echo" or the "Company")
Operations Update: Production and Infrastructure Enhancement Plan
Echo Energy, the Latin American focused energy company, is pleased to provide an operational update regarding further progress in the execution of the Santa Cruz Sur assets production and infrastructure enhancement plan first announced by the Company on 7 July 2022 (the "Enhancement Plan").
Upgrades to the workover rig owned by the Santa Cruz joint venture partners have now been successfully completed.
As previously announced, the Enhancement Plan is targeting a total of approximately 30 or more wells with interventions to commence on mobilisation of the workover rig to the field. The scheduling of activities, on a well-by-well basis, remains dependent on the availability of materials required for individual well interventions and operational activities, including the timing of the future mobilisation of the now upgraded workover rig, will also be optimised from cash flow at the asset level in order to maximise the benefit of funds available.
Detailed scheduling and optimisation of the well re-opening programme under the Enhancement Plan has been undertaken and three additional oil wells have been identified which do not require the mobilisation of the workover rig. These wells have been offline for four years due to surface constraints. However, recently completed infrastructure upgrades have now removed these constraints and enable these wells to now be reactivated with the objective of bringing them back into production.
These three additional wells will be prioritised by the Santa Cruz Sur partners in seeking to further increase liquids production from the Chorillos field. This three well programme has now commenced and operations are expected to take around three weeks.
Following the previously announced successful completion of the first phase of the Enhancement plan focused on the power generation facilities, the already commenced programme to upgrade compressor capacity across the Santa Cruz Sur assets remains ongoing. Efforts continue to optimise the balance between maximising production and cashflow, minimising disruption and shortening the time required to complete the upgrades.
Production at Santa Cruz Sur in the first month of Q4 2022 has been strong with average daily production in October of 1,610 boe, net to Echo's 70% interest. This represents the highest monthly average production achieved in 2022 and a 13% increase over the monthly average during Q3 2022.
These increased production levels demonstrate the positive impact of the successful implementation of the initial phases of the Enhancement Plan.
Corresponding net gas production for October was 7.7 MMscf/d with liquids production of 325 bopd. This represents the highest monthly average achieved for liquids in 2022, and a 27% increase over the levels achieved in January 2022, as the Company has prioritised liquids production given current commodity markets.
The Company looks forward to continuing to update shareholders on further operational progress.
For further information, please contact:
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Echo Energy Martin Hull, Chief Executive Officer
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via Vigo Communications |
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Vigo Consulting (IR & PR Advisor) Patrick d'Ancona Finlay Thomson
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+44 (0) 20 7390 0230 |
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Cenkos Securities (Nominated Adviser) Ben Jeynes Katy Birkin
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+44 (0) 20 7397 8900 |
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Arden Partners plc (Corporate Broker) Simon Johnson (Corporate Broking) John Llewellyn-Lloyd (Corporate Finance)
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+44 (0) 20 74614 5900 |
Note
The assignment of Echo's 70% non-operated participation in the Santa Cruz Sur licences is subject to the authorisation of the Executive Branch of Santa Cruz's Province, which is part of the overall process of title transfer that is proceeding as anticipated.
bopd means barrels of oil per day; boe means barrels of oil equivalent; MMscf means million standard cubic feet of natural gas; and MMscf/d means million standard cubic feet of natural gas per day.
Certain of the information contained within this announcement is deemed by the Company to constitute inside information as stipulated under The Market Abuse Regulation (EU 596/2014) pursuant to the Market Abuse (Amendment) (EU Exit) Regulations 2018. Upon the publication of this announcement via a Regulatory Information Service ("RIS"), this inside information is now considered to be in the public domain.
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