REG - Block Energy PLC - Carbon Sequestration MoU

Block EnergyAnnouncement

08/05/2024 07:00

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RNS Number : 5045N  Block Energy PLC  08 May 2024

8 May 2024

Block Energy plc

("Block" or the "Company")

Carbon Sequestration MoU

Block Energy plc, the development and production company focused on Georgia,
is pleased to announce a Memorandum of Understanding ("MoU") with JSC Rustavi
Azot, a subsidiary of Indorama Corporation Pte Ltd ("Rustavi Azot"), one of
Asia's leading chemical companies, to develop the Carbon Capture and Storage
("CCS") opportunity identified within Block's Patardzeuli-Samgori Middle
Eocene reservoir. The MoU is non-exclusive, and has a duration of 1 year from
7 May 2024, extendable by mutual agreement.

Block and Rustavi Azot will form joint technical and commercial teams to begin
defining a pilot CO(2) injection project and will share commercial and
economic information to determine an optimal monetisation scheme.

The work will build on the initial study by Oilfield Production Consultants
Ltd ("OPC") which, as announced on 16 January 2024, estimates a CO(2) storage
capacity ranking - at both reservoir and basin scales - amongst the highest in
Europe. The reservoir scale storage is estimated at 256 million metric
tonnes, equivalent to offsetting the annual emissions of 55 million cars, and
the basin scale at up to 8.7 gigatonnes, equivalent to offsetting emissions
from Turkey for 20 years.

 

The study, led by Professor Eric Oelkers, a leading expert in the field of
water-rock interactions, concluded that the Patardzeuli-Samgori Middle Eocene
is suitable for the application of similar sequestration technology currently
being used by Carbfix in Iceland, in which dissolved CO(2) is mineralised into
naturally reactive minerals within volcanic reservoir sequences. This
technique, which Professor Oelkers helped develop as co-founder of CarbFix,
has the advantage of rapid and permanent sequestration with minimal risk
of leakage.

 

About Rustavi Azot

Rustavi Azot is a key nitrogen fertilizer and industrial chemicals producer in
Georgia. Rustavi Azot is a subsidiary of Indorama Corporation, Singapore.
Indorama, together with its affiliate companies, produces a wide range of
products for an international market, including fertilisers, chemicals and
textiles. Rustavi Azot is located close to Block's licences by the town of
Rustavi. Rustavi Azot is one of the largest gas consumers in Georgia and
exports its products internationally, including to EU member states.

Synergies & Sustainability

The optimal geology of the Patardzeuli-Samgori reservoir, which the OPC study
indicates is accessible to proven sequestration technology, and the proximity
of the Rustavi Azot facility offer the conditions for one of the lowest cost
carbon sequestration projects in Europe. The project supports both partners'
long-term commitment to sustainability.

Commenting, Paul Haywood, Block Energy Chief Executive Officer said:

"We're delighted to enter into an MoU with Rustavi Azot, and now look forward
to forming technical and commercial teams to progress this highly prospective
CCS project.

With EU Emissions Trading Scheme ("ETS") prices at around USD 60/ton, the
agreement is a significant step forward to developing a commercial pathway
toward project development. With upstream and downstream synergies critical
for any CCS project, brownfield infrastructure available for re-use, and the
conditions for low-cost proven technology, we are excited to see this project
develop and look forward to updating shareholders in due course."

Commenting, Mr. Jay Prakash Jajoo, General Director of JSC Rustavi Azot said:

"Indorama is pleased to enter into this MoU with Block Energy to pilot CCS. We
are excited to serve our key markets with products having lower CO(2)
footprints in our commitment towards reducing carbon emissions."

**ENDS**

Stephen James BSc, MBA, PhD (Block's Subsurface Manager) has reviewed the
reserve, resource and production information contained in this
announcement. Dr James is a geoscientist with over 40 years of experience in
field development and reservoir management.

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION AS STIPULATED UNDER
THE UK VERSION OF THE MARKET ABUSE REGULATION NO 596/2014 WHICH IS PART OF
ENGLISH LAW BY VIRTUE OF THE EUROPEAN (WITHDRAWAL) ACT 2018, AS AMENDED.  ON
PUBLICATION OF THIS ANNOUNCEMENT VIA A REGULATORY INFORMATION SERVICE, THIS
INFORMATION IS CONSIDERED TO BE IN THE PUBLIC DOMAIN.

For further information please visit http://www.blockenergy.co.uk/
(http://www.blockenergy.co.uk/)  or contact:

 Paul Haywood                                   Block Energy plc                 Tel: +44 (0)20 3468 9891

 (Chief Executive Officer)
 Neil Baldwin                                   Spark Advisory Partners Limited  Tel: +44 (0)20 3368 3554

 (Nominated Adviser)
 Peter Krens                                    Tennyson Securities              Tel: +44 (0)20 7186 9030

 (Corporate Broker)
 Philip Dennis / Mark Antelme / Ali AlQahtani   Celicourt Communications         Tel: +44 (0)20 7770 6424

 (Financial PR)

 

Notes to editors

Block Energy plc is an AIM-listed independent oil and gas production and
development company with a strategic focus on unlocking the energy potential
of Georgia. With interests in seven Production Sharing Contracts in central
Georgia, covering an area of 4,256 km(2), including the XIB licence which has
over 2.77TCF of 2C contingent gas resources, with an estimated Net Present
Value (10) ("NPV") of USD 1.65 billion, in the Patardzueli-Samgori, Rustavi
and Teleti fields. (Source: IER, OPC 2024 & Internal estimates).

The Company has structured its operations around a four-project strategy.
These projects, characterized by development stage, hydrocarbon type, and
reservoir, are pursued concurrently to achieve multiple objectives. This
includes increasing existing production, redeveloping fields, discovering new
oil and gas deposits, and capitalizing on the substantial, yet untapped, gas
resource across its licences. The goal is to deliver on multi TCF gas assets,
strategically well located for the key EU market, supported by partner funding
and cash from existing producing assets.

Located near the Georgian capital of Tbilisi, Block Energy is well-positioned
to contribute significantly to the region's energy landscape. This proximity
facilitates seamless operations and underscores our commitment to the economic
and energy development of Georgia.

 

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