REG - Zephyr Energy PLC - State 36-2R well update

Zephyr EnergyAnnouncement

06/06/2024 07:00

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RNS Number : 3247R  Zephyr Energy PLC  06 June 2024

 

 

Prior to publication, the information contained within this announcement was
deemed by the Company to constitute inside information as stipulated under
the UK Market Abuse Regulation. With the publication of this announcement,
this information is now considered to be in the public domain.

 

6 June 2024

Zephyr Energy plc

("Zephyr" or the "Company")

 

 State 36-2R well update

 

Zephyr Energy plc (AIM: ZPHR) (OTCQB: ZPHRF), the Rocky Mountain oil and
gas company focused on responsible resource development and carbon-neutral
operations, is pleased to provide an update on drilling operations on the
State 36-2R LNW-CC well ("the well") at the Company's flagship project in
the Paradox Basin, Utah, U.S.

 

Drilling operations have been completed safely and successfully, with the well
drilled to a total depth of 10,290 feet (measured depth).

 

Zephyr's operations team is now preparing to set a production liner across the
Cane Creek reservoir section (the "reservoir"), after which the Helmerich
& Payne Rig 257 will rig down and demobilise from the site. Over the
coming weeks, Zephyr will mobilise equipment for completion and production
testing of the naturally fractured reservoir zone that was successfully
intersected during drilling operations.

 

Initial results indicate that the well, like the State 36-2 LNW-CC well (the
"original well"), penetrated a folded and naturally fractured section of the
reservoir. It intersected the top of the reservoir approximately 15 feet from
the original well bore and its natural fracture network. The well encountered
drilling mud gas shows of a similar magnitude to the original well and pore
pressure analysis suggest formation pressures estimated at approximately 9,300
pounds per square inch (which is broadly consistent with previously drilled
offset wells).

 

The well further confirms the presence of hydrocarbons within a large
structural compartment, within Zephyr's acreage and 3D seismic coverage.
During the upcoming production test, the well will be flowed and production
tested to determine reservoir pressure, fluid composition, well flow rate,
bulk reservoir permeability and deliver an early estimate of the overall
potential recoverable resources.

 

Colin Harrington, Zephyr's Chief Executive, said:

 

"I am delighted to have concluded drilling operations safely and in line with
our plans. We have intersected the reservoir remarkably close to the original
well and early indications imply confirmation of hydrocarbons - and that we've
likely been successful in hitting our natural fracture target with precision.

 

"Our next step is to commence the well production test in the coming weeks,
subject to service availability.  We look forward to keeping the market
apprised as testing operations commence and a more fulsome evaluation of the
well result becomes available."

 

 Contacts

 Zephyr Energy plc                                                         Tel: +44 (0)20 7225 4590

 Colin Harrington (CEO)

 Chris Eadie (Group Finance Director and Company Secretary)

 Allenby Capital Limited - AIM Nominated Adviser                           Tel: +44 (0)20 3328 5656

 Jeremy Porter / Vivek Bhardwaj

 Turner Pope Investments - Joint-Broker                                    Tel: +44 (0)20 3657 0050

 James Pope / Andy Thacker

 Panmure Gordon (UK) Limited - Joint-Broker                               Tel: +44 (0) 20 7886 2500

 John Prior / Hugh Rich / James Sinclair-Ford / Harriette Johnson

 Celicourt Communications - PR

 Mark Antelme / Felicity Winkles                                          Tel: +44 (0) 20 8434 2643

 

 

Qualified Person

 

Dr Gregor Maxwell, BSc Hons. Geology and Petroleum Geology, PhD, Technical
Adviser to the Board of Zephyr Energy plc, who meets the criteria of a
qualified person under the AIM Note for Mining and Oil & Gas Companies
- June 2009, has reviewed and approved the technical information contained
within this announcement.

 

Notes to Editors

Zephyr Energy plc (AIM: ZPHR) (OTCQB: ZPHRF) is a technology-led oil and
gas company focused on responsible resource development from carbon-neutral
operations in the Rocky Mountain region of the United States.  The
Company's mission is rooted in two core values: to be responsible stewards of
its investors' capital, and to be responsible stewards of the environment in
which it works.

Zephyr's flagship asset is an operated 46,000-acre leaseholding located in
the Paradox Basin, Utah, 25,000 acres of which has been assessed to hold,
net to Zephyr, 2P reserves of 2.6 million barrels of oil equivalent ("mmboe"),
2C resources of 34 mmboe and 2U resources 270 mmboe.

In addition to its operated assets, the Company owns working interests in a
broad portfolio of non-operated producing wells across the Williston
Basin in North Dakota and Montana. Cash flow from
the Williston production will be used to fund the planned Paradox
Basin development. In addition, the Board will consider further opportunistic
value-accretive acquisitions.

 

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