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DJ Block Energy Plc Ownership Interest Increased to 69% in Norio Block

 
TIDMBLOK 
 
17 July 2017 
 
                               Block Energy plc 
 
                       ("Block Energy" or the "Company") 
 
              Ownership Interest Increased to 69% in Norio Block 
 
Block Energy Plc, is pleased to announce that it has increased its ownership in 
the Norio Onshore Oil Field Production Sharing Contract ("PSC") to 69% from a 
38% working interest, by making a further payment of US$310,000 in cash to 
Georgia Oil and Gas Ltd ("GOG"), in line with the acquisition announced on the 
11th April 2017. The Company intends to fully exercise its right, to move to a 
100% working interest in the PSC, before progressing into its defined 
production enhancement and field development programme. 
 
Highlights: 
 
  * Schlumberger estimated Norio contains 118.7 million stock tank oil 
    initially in place ("STOIIP") 
 
  * Norio has produced 1.9M barrels ("bbls") to date - current production is 
    25bbls/d of light sweet oil from three wells drilled in the mid/late 1970s 
    generating sufficient revenue to cover operational costs 
 
  * Drilling and marketing Infrastructure available for immediate use and in 
    close proximity 
 
  * Defined production enhancement programme has been prepared and awaiting the 
    drill bit. Short term target of >250 barrels of oil per day ("bopd") 
 
  * Georgia is an emerging oil and gas region which has most recently benefited 
    from a significant entry by Schlumberger one of the world's largest service 
    companies in addition to other regional exploration and production ("E&P") 
    companies 
 
Paul Haywood, Director, said, "The Norio Oil Field is a highly prospective 
proven block with STOIIP 118 million bbls of Oil potential and with existing 
production.  We are delighted to move closer to a 100% ownership in Norio, 
which ensures our stakeholders acquire maximum exposure to all future value 
created. 
 
Norio has fantastic potential to provide the Company with significant cashflow 
in the near term, bolstering a key part of our strategy toward becoming a 
leading Georgian focused E&P company.  Importantly, all minimum work programme 
commitments in Norio have been fulfilled and cost controls pertaining to 
operating expenditure requirements are being tightly managed, all of which 
largely support having a 100% working interest.  We look forward to increasing 
our ownership and advancing work plans and production at Norio in the near 
future.  Again, I'd like to thank all stakeholders for their support and the 
Company continues to look forward to updating the market on what is to come." 
 
Further information: 
 
The Board intends to increase this production rate to >250 bbls/d and move the 
Company into free cash flow territory within six months of the work programme 
commencing.  This will be achieved by cleaning up existing producing wells 
(cleaning/changing of pumps etc.) and re-completing further existing wells 
utilising modern drilling technologies, re-perforating and horizontal side 
tracks. 
 
The Company also has a farm-in agreement to acquire up to a 75% working 
interest in Block XIf PSA (announcement of 28 June 2017), which hosts the 
Rustavi onshore Oil and Gas field and adjacent to Block XIb being advanced by 
Schlumberger who has a 100% working interest in the relevant PSA. The Rustavi 
field has multiple wells that have tested oil and gas from multiple horizons 
and contains Russian estimates of 16.3 million barrels of oil (Russian C1 
category) and 620 billion cubic feet ("bcf") of light sweet gas potential 
(Russian C2 category). 
 
The Directors of the Issuer accept responsibility for this announcement. 
 
For further information contact: 
 
Block Energy plc  Executive 
Director                          Tel:  020 3053 3631 
Paul Haywood                      Paul @blockenergy.co.uk 
 
Peterhouse Corporate Finance      Tel +44 020 7469 0930 
 
Guy Miller / Mark Anwyl 
 
 
 
END 
 

(END) Dow Jones Newswires

July 17, 2017 03:47 ET (07:47 GMT)