4 November 2014
IGas Energy PLC
("IGas" or "the Company")
Barton Moss Exploration Well Results and Combined Group Gas Initially In Place Estimates ("GIIP") for Natural Gas from Shale
IGas (LSE: IGAS), one of the leading producers of onshore hydrocarbons in the UK, is pleased to announce results of its exploration well at Barton Moss and, following the acquisition of Dart Energy, revised shale GIIP estimates for the enlarged group.
The Barton Moss well was drilled as an exploration well in PEDL 193 in the North West of England, with the original key objectives of fulfilling the 13th Licence Round commitment obligation, assessing the CBM potential of the area and delineating the deeper Dinantian limestone horizon to better calibrate the pre-existing seismic interpretation which has confirmed our interpretation of the basin and so informed our 14th onshore licensing application accordingly.
The well, which was completed in March 2014, was successful in achieving all of these objectives and the results have helped refine our geological models and are consistent with our overall basin depositional model. The well encountered 15 gas bearing coal seams in accordance with the pre-drill prognosis. The well also encountered a Namurian Shale section, consisting of the Sabden Shale and the Upper and Lower Bowland Shales. Approximately 400 feet of core was recovered, including from the shale section.
The key results from the Barton Moss well cores, analysed by Weatherford in Colorado, are as follows:
· Total Organic Carbon ("TOC") analysis indicates values of up to 5.72% with an average of ca. 1.9%
· The thermal maturity measurements of the shale places the shale in the gas generating window as per the basin model predictions
· The measured permeabilities are comparatively high for the observed porosities when compared with other typical US shale plays
· The mineralogy of the Bowland Shales in this area are very comparable with other key US plays, notably the Marcellus and Fayetville, when comparing quartz/clay/carbonate content
· The cores were observed to have numerous natural fractures with some evidence of alteration due to fluid migration. This is believed to be associated with the depositional setting of the well location.
In summary, the results from the Barton Moss well represent an important datapoint in understanding the structural and depositional setting of the basin. The results will help refine the subsequent appraisal programme as well as better delineate the resource potential. The extensive core and log analysis undertaken to date will be invaluable in defining future development options including geomechanical data for the design of hydraulic fracture treatments.
These results combined with the earlier Ince Marshes-1 well which encountered a thick (ca 1000 feet) section of shale with good TOC's and the forthcoming Ellesmere Port exploration well will help to better define the overall potential of the IGas acreage in the North West.
The Company has developed an estimate of GIIP for the enlarged group's shale gas position as follows:
GIIP* |
Low |
Most likely |
High |
Net Tcf |
34 |
147 |
263 |
Gross Tcf |
50 |
192 |
352 |
*excludingWeald Basin licences areas and Coal Bed Methane
These figures are based on our previous estimates for the North West, revised to incorporate the Barton Moss results, the shale gas volumes attributable to the Dart Energy acquisition and the results of a recent study as to the shale gas estimates for our existing East Midlands acreage.
The intention is to commission a separate independent CPR report for the combined group (ie including Dart Energy) as of 31 December 2014 which is expected to be available in H1 2015.
2D seismic acquisition in the North West has now commenced and this, combined with proposed further 3D acquisition, will enable us to submit applications for multi-well sites for drilling and hydraulic fracturing of gas from shale in 2015.
A short technical presentation of the results will be available at www.igasplc.com/investors.
Commenting on this release, CEO Andrew Austin said "The results of the well are encouraging in respect of the shale potential of the area as they have helped further refine the existing basin models and verify the earlier preliminary prognosis. The results were employed in our 14th licence round applications. I am also pleased to announce the revised GIIP numbers where more data has narrowed the range and increased the overall potential which, coupled with our funded work programme of $80 million, gives us the ability to demonstrate the commerciality of gas extraction from these prospective areas.
Specifically, our work in the northwest continues with seismic acquisition, site selection and the up-coming well at Ellesmere Port."
John Blaymires, Chief Operating Officer of IGas Energy Plc, and a qualified person as defined in the Guidance Note for Mining, Oil and Gas Companies, March 2006, of the London Stock Exchange, has reviewed and approved the technical information contained in this announcement. Mr. Blaymires has more than 30 years' oil and gas exploration and production experience.
For further information please contact:
IGas Energy plc |
Tel: +44 (0)20 7993 9899 |
Andrew Austin, Chief Executive Officer Stephen Bowler, Chief Financial Officer Ann-marie Wilkinson, Head of Communications |
|
Jefferies International Limited |
Tel: +44 (0)20 7029 8000 |
Sara Hale Graham Hertrich Canaccord Genuity Tim Redfern |
Tel: +44 (0)20 7523 8000 |
MHP
Rupert Trefgarne Tel: +44 (0)20 3128 8100
