BLM Approval for Permit to Drill GV 22-1 well
Prior to publication, the information contained within this announcement was deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014 ("MAR"). With the publication of this announcement, this information is now considered to be in the public domain.
1 November 2018
Rose Petroleum plc ("Rose or the "Company")
BLM Approval of Application for Permit to Drill GV 22-1 well
Rose Petroleum plc (AIM: ROSE), the North America-focused oil and gas company, is pleased to announce that the U.S. Bureau of Land Management ("BLM") has approved the Application for Permit to Drill ("APD") for the proposed GV 22-1 well within the Company's Paradox acreage ("Paradox acreage") in Utah. The APD will be valid for an initial period of two years.
The GV 22-1 well location is within the new leases acquired in March 2018, within the area covered by the Company's 3D seismic acquisition that was completed in December 2017, and adjoining the existing leases already within the Gunnison Valley Unit.
The Company now plans to drill its first unit obligation well at the GV 22-1 location as soon as possible, however, the Company has agreed with the BLM to extend the boundary of the Gunnison Valley Unit to include the new leases in that unit. The unit boundary changes, which will allow the GV 22-1 to be the next obligation well, involve an amount of administrative detail and are expected to take approximately 45 days, assuming no unforeseen delays.
Once the boundary changes have been completed all permits required from both the BLM and State of Utah will be in place for operations to commence, subject to the operational stipulations of the APD. Discussions regarding financing of the drilling programme are ongoing and will be accelerated once these GVU boundary amendments are finalised by the BLM.
The GV 22-1 will be a horizontal well which Rose's management consider has a potential Estimated Ultimate Recovery ("EUR") of 894,000 barrels of oil equivalent ("BOE"), consistent with the Gaffney Cline Competent Person's report. The potential of the GV 22-1 well is supported by its close analogy to highly productive structures (>1mmboe EUR) within the nearby Cane Creek Field (12 miles south) and locally by its close proximity to the producing 28-11 well (approx. 1 mile). This well produces from the porous and permeable fracture network within Clastic 21 and can be tied to the proposed 22-1 location within the 3D seismic data set. The 28-11 is a vertical well that was drilled by Delta Petroleum in 2006 without the benefit of 3D seismic. It has produced 141,000 barrels of oil equivalent ("BOE"), and represents a key piece of evidence for the presence of hydrocarbons and of a greater fracture network across the area covered by the 3D seismic. These factors give the Board a high degree of confidence in the potential of the GV 22-1 well, and it was for these reasons that the Company decided to prioritise the GV 22-1 location as Rose's first well.
Further updates will be provided as soon as appropriate on both the inclusion of the additional leases within the GVU and on the proposed timing for the spudding of the Company's first Paradox well.
Matthew Idiens, CEO, commented: "We are delighted to have received this final permit for the GV 22-1 well. Having acquired a significant footprint in the Basin, permitted and shot the 3D seismic, processed and interpreted the data with fantastic results, we are now finally close to delivering on our key corporate objective of spudding our first Paradox well."
Contacts:
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Rose Petroleum plc Matthew Idiens (CEO) Chris Eadie (CFO)
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Tel: +44 (0)20 7225 4595 Tel: +44 (0)20 7225 4599 |
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Allenby Capital Limited - AIM Nominated Adviser Jeremy Porter / James Reeve / Liz Kirchner
Cantor Fitzgerald Europe - Financial Adviser and Joint Broker Nick Tulloch David Porter
Turner Pope Investments - Joint Broker |
Tel: +44 (0)20 3328 5656
Tel: +44 (0)131 257 4634 Tel: +44 (0)20 7894 7686
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Andy Thacker
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Tel: +44 (0)20 3621 4120 |
Media enquiries:
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Allerton Communications |
Tel: +44 (0) 20 3633 1730 |
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Peter Curtain |
peter.curtain@allertoncomms.co.uk |
Notes to editors
Rose Petroleum plc (http://rosepetroleum.com) is a North America-focused oil and gas company whose primary asset is approximately 80,000 net acres in the prolific oil and gas producing Paradox Basin in Utah, U.S.A., where it is earning into a 75% working interest. Using high-quality data gathered in a 3D seismic survey completed in October 2017, the Company has identified drilling locations in naturally fractured areas of the Paradox Formation with the intention of commencing a drilling programme in H2 2018.
On 22 June 2018, Rose announced a Competent Person's Report ("CPR") and Maiden Contingent Resource by Gaffney Cline & Associates ("GCA") on the Rose acreage covered by the 3D seismic, approximately 17,250 acres of the 80,000 acres held. The CPR estimated a 2C Contingent Resource, net to Rose, of 9.25 MMBbl of oil and 18.50 Bscf of gas, and an unrisked pre-tax Net Present Value (NPV10) on the 2C Resources, net to Rose, of US$122 million. The CPR focused solely on one single reservoir - the Cane Creek reservoir (the "CCR" or "Clastic 21") - of the multiple prospective reservoirs within the Paradox Formation.
The Company's established management is supported by an expert technical team with extensive experience of the basin, where current operations nearby have proven successful, with significant initial production rates and low decline rates, offering strong economics even in the present oil price environment.
The Company's strategy is to grow both organically and through acquisition, identifying additional hydrocarbon assets, conventional or unconventional, that would benefit from the Company's fast-acting, entrepreneurial approach.
Rose Petroleum has been quoted on AIM since June 2004.
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