More good news from Australia
" Newport Exploration Ltd ("Newport" or "the Company") is pleased to report on highlights of Beach Energy Ltd.'s ("Beach") Report for the Half Year ended 31st December, 2019, as reported in a news release by Beach on 11th February, 2020. The highlights reported in this news release relate to production and drilling activities on licenses in the Cooper Basin, Australia over which the Company has a 2.5% Gross Overriding Royalty ("GOR").
Beach Report - Highlights
Beach drilled 20 oil development wells on ex PEL 91, with a 100% success rate.
All wells were successfully cased and suspended as future producers.
12 horizontal oil development wells were drilled across the Bauer, Kalladeina, Chiton and Congony fields in ex PEL 91. All four fields are being appraised.
Bauer-39 initial production at greater than 2,000bpd.
Several new well locations identified.
Infrastructure approved to support increased production.
Appraisal Drilling on ex PEL 91
At the Bauer field, appraisal drilling activity added new oil production wells.
Field extensions have been identified in both the northern and southern parts of the field.
A phase 2 appraisal program is planned at Bauer to further resolve the structural extent of the field.
Bauer-39 was the longest horizontal well drilled in the field to date with a McKinlay section of 1517m in length with a 90% reservoir. Beach anticipate a 30 day Initial Production rate of greater than 2,000bopd on pump.
Bauer-39 indicated a lifted McKinlay structure in the south-east of the field.
Beach have dedicated an exploration rig to further appraise the Kalladeina/Congony fields.
Updated Reserves are to be reported at the end of Beach's FY2020, incorporating new development, appraisal and production data.
Development Drilling on ex PEL 91
Development drilling will target maintaining/increasing oil output in the second half of Beach's FY2020 with 10 additional lateral McKinlay wells at Bauer.
Beach propose to increase the use of horizontal drilling to optimize field development.
Western Flank Gas (ex PEL's 106, 107 and 91)
Beach report first half FY2020 production of 1.1MMboe, up 8% from the first half of FY2019.
Two successful wells were completed in FY2019.
Beach report that the inventory of wells is sufficient to keep the plant full for the next 12-18 months.
Beach propose to increase/optimize condensate output from the recently connected Lowry well that has a condensate gas ratio of 50bbl/MMscf.
On ex PEL 106 (Udacha) appraisal and development wells are planned in FY2021 to maintain deliverability into the Middleton gas facility.
On ex PEL 107 a drilling campaign is planned for FY2021.
Infrastructure Development
Following the successful appraisal drilling program at Bauer, Beach have approved additional work (estimated at ~AUD$30M) to include further artificial lift installations, water handling and intra-field flow lines and roads in order to support higher oil production rates beyond FY2020.
Guidance
With the success of the drilling programs conducted by Beach for both oil and gas permits over which the Company holds its 2.5% GOR, the Company anticipates continuity of production and associated royalty revenues. The Company has a strong balance sheet with no debt and management is confident in its ability to maintain regular quarterly dividend payments.
The Company receives its GOR from Beach, which is not a reporting issuer in Canada, therefore Newport is not able to confirm if the disclosure satisfies the requirements of NI 51-101 - Standards of Disclosure for Oil and Gas Activities, or other requirements of Canadian securities legislation.
The Company continues to strongly encourage shareholders and potential investors to access information released independently by Beach and Santos Ltd to keep current during exploration, development and potential production of all the licenses subject to the Company's GOR. Shareholders and potential investors may also be interested in Equity Research Reports on Beach such as those prepared by RBC Capital Markets."
