Europa Oil identifies expanded resource on EG-08

22nd Jul 2024 15:10

(Sharecast News) - Europa Oil & Gas announced a significant update on the EG-08 block on Monday, reporting that an additional 716 billion cubic feet (BCF) of unrisked prospective resources had been identified, bringing the total gross unrisked mean prospective resources on the block to 2.116 trillion cubic feet equivalent (TCFe).

The AIM-traded firm said the development followed the acquisition of a 42.9% equity interest in Antler Global, announced in December.

It said the technical teams from both Europa and Antler had thoroughly evaluated seismic data across the three originally-identified prospects and completed a study to identify additional prospectivity on the EG-08 block.

Antler holds an 80% interest in the EG-08 production sharing contract, located offshore Equatorial Guinea, with Guinea Ecuatorialde Petroleos (GEPetrol), the national oil company, holding the remaining 20%.

The board said the re-evaluation of the seismic data had resulted in significant findings with the primary prospect, Barracuda, having a mean prospective resource of 798 BCFe in strata equivalent to the producing Alen Field in Block O, located nine kilometres from Barracuda.

Additionally, 599 BCFe of Pmean was identified in two low-risk tie-in prospects, Cardinal and Arrowhead, within the Alen Strata.

Four additional higher-risk prospects in the Alen Strata were identified with 344 BCFe of Pmean, and two additional leads had a combined 375 BCFe of Pmean.

Revised economic analysis indicated that the minimum gross volume for a commercial discovery could be around 90 BCFe, or 15.2 million barrels of oil equivalent (MMBOE).

With the technical work on the block now complete, the data was being loaded into a data room, which would be accessible to upstream companies in the coming weeks.

Interested companies would be invited to sign confidentiality agreements to gain access to the data.

Several companies had already shown interest in farming into the block.

Europa said Antler aimed to secure a farmin partner to accelerate the drilling of an exploration well, targeting one horizon in the Barracuda prospect with an estimated geological chance of success (GCOS) of 70%.

Future wells would aim to exploit the significant additional upside in Barracuda and throughout the licence.

The recent technical work included a petrophysical evaluation of the O-2 well drilled by Noble Energy in 2007, which encountered gas condensate in the upper section of the reservoir.

Europa said the Farmin Well would target the same reservoir section, up-dip from the O-2 well.

Initial discussions had also started with rig providers to secure a jack-up rig for drilling the Farmin Well in the second half of 2025.

Given the number of rigs operating in the area, there was expected to be good rig availability during the planned drilling period.

"I am very pleased with the progress that Antler and our technical team has made on the EG-08 licence," said chief executive officer Will Holland.

"The technical work has not only increased the prospectivity of the block by 50% to over 2TCFe, but also further de-risked the Barracuda prospect by identifying gas in the O-2 well, which we will be drilling up-dip from on the same structure.

"I am confident that we will be able to secure a suitable partner on EG-08 to carry us through the drilling of an exploration well on the Barracuda prospect."

Holland said that while the setting up of the data room had taken slightly longer than expected, he was "delighted" with the additional information that could now be offered to potential farminees.

"Given the proximity to existing infrastructure, any discovery can be brought online quickly, resulting in impressive economic returns.

"In addition, the block has plenty of additional prospectivity, all of which will be attractive to major upstream companies.

"I look forward to updating the market further as we continue to progress this highly prospective asset located in a region which is well supplied by service companies and supported by an efficient and sophisticated local regulator and ministry."

At 1455 BST, shares in Europa Oil were up 1.39% at 1.17p.

Reporting by Josh White for Sharecast.com.