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Mosman Oil & Gas #MSMN – Falcon-1 Production Update
Mosman Oil and Gas Limited (AIM: MSMN) the oil exploration, development and production company, announces an update on the Falcon-1 well and the Stanley Project in East Texas, USA.
Falcon-1 (Mosman 50% working interest)
The Falcon-1 well was recompleted in a new zone last week and Mosman now confirms that the Falcon-1 well is producing gas and oil with no reported water. The flow is intentionally restricted with a 5/64 choke well to monitor the well performance. The production rate with this choke is c600 mmbtu/day (c105 boepd) and the well has been operating at this level since 12 June. Whilst this gas and oil production rate is similar to the recent production rate in the lower zone, the profit margin will be greater as operating costs will be reduced due to lower water disposal costs.
Production from this zone also verifies the wireline log interpretation of multiple hydrocarbon bearing zones in this well. This will enable an update of the geological model of this lease and the adjacent Galaxie lease.
Stanley (Mosman 15-19% working interest)
The Operator has advised that hot oil treatment of the surface pipeline was successful and enabled an increase in gross production from Stanley-3 from 40 to 65 bopd.
The Operator has also advised that Stanley-4 will be back on production this week. The decision has also been made to gravel pack Stanley-1 for sand control, in order to produce the well without needing workovers to remove sand from the wellbore or pumping equipment, and this well should also be back on production in the near future.
Qualified Person’s Statement
The information contained in this announcement has been reviewed and approved by Andy Carroll, Technical Director for Mosman, who has over 35 years of relevant experience in the oil industry. Mr. Carroll is a member of the Society of Petroleum Engineers.
Market Abuse Regulation (MAR) Disclosure
Certain information contained in this announcement would have been deemed inside information for the purposes of Article 7 of Regulation (EU) No 596/2014 until the release of this announcement.
Enquiries:
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Mosman Oil & Gas Limited John W Barr, Executive Chairman Andy Carroll, Technical Director |
NOMAD and Broker SP Angel Corporate Finance LLP Stuart Gledhill / Richard Hail / Adam Cowl +44 (0) 20 3470 0470 |
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Alma PR Justine James +44 (0) 20 3405 0205 +44 (0) 7525 324431 |
Joint Broker Monecor (London) Ltd trading as ETX Capital Thomas Smith 020 7392 1432 |
Updates on the Company’s activities are regularly posted on its website:
Mosman Oil & Gas #MSMN – Half Year Results
Mosman Oil and Gas Limited (AIM: MSMN) the oil exploration, development and production company, announces its Half Year results to 31 December 2020.
Summary
· With a clear focus on the higher margin operations, Mosman took the decision to sell the Welch project and shares in Norseman.
· Proceeds applied to drilling, completing, and installing production facilities at Falcon and workovers at Stanley and Greater Stanley.
· COVID-19 constraints and some production challenges resulted in lower production, which was also impacted by a volatile oil price further affecting revenue
· Revenue of AUD380,000 and Gross Profit AUD56,828
· Net loss of AUD0.7m impacted by production challenges and the volatile oil price in 2020
· Gross Project Production 34,569 BOE 1
· Net Production to Mosman 9,871 BOE 1
1 BOE/boe – barrels of oil equivalent
2 Gross Project Production – means the production of BOE at a total project level (100% basis) before royalties (where Mosman is the Operator) and where Mosman is not the operator the total gross production for the project
3 Net Production – Net to Mosman’s Working interest after royalties
Post period events
· Sold remaining shares in Norseman Silver Inc for AUD208,000
· Completed the sales of the Welch asset for AUD546,611
· Raised £1.5m to be used for Helium, Hydrogen and Hydrocarbon exploration on EP 145 in Central Australia
· Acquired an additional 20% of the Greater Stanley (Duff lease), increasing Mosman’s working interest in Duff to 40%.
John W Barr, Chairman of Mosman commented: “Whilst the first half of FY21 was extremely challenging with continued economic uncertainty, volatile oil price movements and production challenges, we remained resolute that we would weather the storm. We have started Q3 with renewed vigour having completed the disposal of the Welch project to enable us to focus on drilling activity and are look forward to the opportunity our increased working interest in Greater Stanley in the US will bring.
“We are well funded to deliver our exploration and development plan and expect to benefit from the recovery in energy prices. This coupled with the planned exploration at EP145 in Australia, where drilling results in nearby permits have demonstrated the commercial production of hydrocarbons reinforcing the potential for successful helium and hydrogen exploration, sets out an encouraging programme for the months ahead.
“Once again, we thank our shareholders for their support whilst reassuring them of our continued confidence to achieve growth in both production and value for the business.”
Link here for the full financial statements
Enquiries:
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Mosman Oil & Gas Limited John W Barr, Executive Chairman Andy Carroll, Technical Director
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NOMAD and Joint Broker SP Angel Corporate Finance LLP Stuart Gledhill / Richard Hail / Adam Cowl +44 (0) 20 3470 0470
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Alma PR Justine James +44 (0) 20 3405 0205 +44 (0) 7525 324431 |
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Updates on the Company’s activities are regularly posted on its website: www.mosmanoilandgas.com |
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Mosman Oil & Gas Limited #MSMN- Greater Stanley Workover
Mosman Oil and Gas Limited (AIM: MSMN) the oil exploration, development and production company, announces an update on its Greater Stanley Project in East Texas.
The Operator has confirmed that the proposed workover has now commenced to re-complete the Duff-2 well in a zone which has produced oil at the adjacent Stanley Project.
Mosman recently acquired an additional 20% interest to move from 20% to a 40% working interest. The cost of the workover is estimated to be circa US$50,000 (gross), US$20,000 net to Mosman.
Qualified Person’s Statement
The information contained in this announcement has been reviewed and approved by Andy Carroll, Technical Director for Mosman, who has over 35 years of relevant experience in the oil industry. Mr. Carroll is a member of the Society of Petroleum Engineers.
Market Abuse Regulation (MAR) Disclosure
Certain information contained in this announcement would have been deemed inside information for the purposes of Article 7 of Regulation (EU) No 596/2014 until the release of this announcement.
Enquiries:
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Mosman Oil & Gas Limited John W Barr, Executive Chairman Andy Carroll, Technical Director |
NOMAD and Broker SP Angel Corporate Finance LLP Stuart Gledhill / Richard Hail / Adam Cowl +44 (0) 20 3470 0470 |
|
Alma PR Justine James +44 (0) 20 3405 0205 +44 (0) 7525 324431 |
Joint Broker Monecor (London) Ltd trading as ETX Capital Thomas Smith 020 7392 1432 |
Updates on the Company’s activities are regularly posted on its website:
Mosman Oil & Gas #MSMN – Updated Six Monthly Production
Mosman Oil and Gas Limited (AIM: MSMN) the oil exploration, development, and production company, announces an updated production summary for the six months ended 31 December 2020, following receipt of additional production data on its Falcon and Arkoma projects in the USA.
The original report, announced on 14 January 2021, was based on data available at that time from the operators of each project. Net Production attributable to Mosman for the six months now stands at 9,871 boe (compared to 8,650 boe as previously announced).
Production Details
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6 Months to 31 December 2020
UPDATED |
6 Months to 31 December 2020
ORIGINAL |
6 Months to 31 December 2020
UPDATED |
6 Months to 31 December 2020
ORIGINAL |
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Total Project |
Total Project |
Net Attributable |
Net Attributable |
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Gross boe |
Gross boe |
Net boe |
Net boe |
|
|
Falcon* |
2,191 |
– |
1,096 |
– |
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Stanley |
24,982 |
24,982 |
3,984 |
3,984 |
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Greater Stanley |
936 |
926 |
187 |
185 |
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Arkoma |
615 |
– |
123 |
– |
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Welch** |
5,845 |
5,845 |
4,481 |
4,481 |
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Total boe |
34,569 |
31,753 |
9,871 |
8,650 |
Net production means net to Mosman’s working interest before royalties
* Falcon production started on 11 December.
** Welch has now been sold
John W Barr, Chairman of Mosman commented: “The updated production report shows the significant benefit of Falcon-1 production, noting that Mosman only benefitted from production from 11 December 2020. With drilling planned at Stanley, Champion and/or Challenger projects we anticipate further increases to our production in the coming months and have an objective to be involved in at least four new wells in 2021 subject to funding and other matters.”
Qualified Person’s Statement
The information contained in this announcement has been reviewed and approved by Andy Carroll, Technical Director for Mosman, who has over 35 years of relevant experience in the oil industry. Mr. Carroll is a member of the Society of Petroleum Engineers.
Market Abuse Regulation (MAR) Disclosure
Certain information contained in this announcement would have been deemed inside information for the purposes of Article 7 of Regulation (EU) No 596/2014 until the release of this announcement.
Enquiries:
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Mosman Oil & Gas Limited John W Barr, Executive Chairman Andy Carroll, Technical Director
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NOMAD and Joint Broker SP Angel Corporate Finance LLP Stuart Gledhill / Richard Hail / Adam Cowl +44 (0) 20 3470 0470
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|
Alma PR Justine James +44 (0) 20 3405 0205 +44 (0) 7525 324431
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Joint Broker Monecor (London) Ltd trading as ETX Capital Thomas Smith +44 (0) 20 7392 1432 |
Updates on the Company’s activities are regularly posted on its website: www.mosmanoilandgas.com
Technical Glossary
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BBLs or bbls |
Barrels |
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BOPD or bopd |
barrels of oil per day |
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BOEPD or boepd |
barrels of oil equivalent per day calculated on the approximate 1:6 basis of the calorific value of the hydrocarbons, (not based on the price) |
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MMCFPD or mmcfd MMBTU |
Million cubic feet per day
Million British Thermal Units |
Mosman Oil & Gas #MSMN – Operations update
Mosman Oil and Gas Limited (AIM: MSMN) the oil exploration, development and production company, announces an update on operations in the US.
Stanley
The Operator has recently recompleted Stanley-1 in a zone that has been productive in Stanley-2, and initial flow rates (3 day average) are 47 bopd gross. The Company will provide a further update in due course once production rates have stabilised at Stanley-1.
Stanley-2, 3 and 4 continue to produce oil, with a total project production (including Stanley 1) of circa 260 bopd (3 day average) gross. Mosman has 16-18% working interest in these wells. Water production is managed by on-site water injection that has not been affected by recent unusual cold weather conditions.
Falcon
Minor equipment upgrades have been installed at the Falcon-1 well. The well has been temporarily shut-in since 15 February due to the weather conditions, to avoid water vapour freezing in the gas lines. Oil production and produced water is stored in tanks and has to be trucked off site. The Operator expects to have the well back on production once freezing conditions end, which are forecast to improve and warm up on Saturday. Mosman has 50% working interest in this well. Further updates will be provided in due course.
Other Production
The majority of current production comes from the Stanley and Falcon projects. Mosman has not been advised of any effect of the weather on other facilities such as Greater Stanley and Arkoma.
Drilling opportunities
Mosman confirms its intention to participate in the drilling of multiple wells in the 2021 year.
The candidates for drilling include wells at the Stanley project (where four wells have already been drilled with a 100% drilling success rate) and other wells in East Texas, including wells at Greater Stanley, Cinnabar and Galaxie. Of these projects, Mosman only has control of the timing of operations where it is the Operator, at the Cinnabar lease.
The Cinnabar lease acquisition is considered a potential cornerstone of the Challenger Project to re-develop the proven oil producing area. Mosman has 97% working interest (reducing to 85% upon drilling of the first well) in the Cinnabar lease and is the Operator. The initial review of existing data has led Mosman to commit to a full field redevelopment study that will be based on technical work which includes the following:
· Acquiring additional seismic data
· Reprocessing the seismic data
· Revised geological model
· Acquiring additional leases
· Identifying optimal drilling locations
· Designing wells
· Drilling planning
The successful drilling of Falcon-1 means there are several prospects to be drilled in the Falcon and Galaxie lease area (Champion Project). The Falcon-1 well production data will be used to estimate the size of that gas field, and to update the geological model, before a decision is made where to drill the next well in the Champion Project. Mosman has 50% interest in the Falcon lease and 60% working interest in the Galaxie lease.
There are several potential wells in the Greater Stanley area that require further work before being ready to drill. The work includes leasing, gaining well spacing approval and technical work to determine optimal target locations. The zone that is producing at Stanley-1 and 2 is thought to extend in to the Duff lease, and is a candidate for recompletion of the Duff-2 well. Mosman has 20% working interest in the Duff lease.
John W Barr, Chairman, said: “Mosman appreciates the work and effort that is involved in getting a project completed and maintaining solid production. Presently, the Covid pandemic, heavy rain and this severe cold weather are examples of reasons why things sometimes take longer than anticipated.
“For the moment, the safety of people, and the operations is imperative. Hopefully, normality will return shortly, along with communications that have been difficult due to rolling power blackouts.”
Qualified Person’s Statement
The information contained in this announcement has been reviewed and approved by Andy Carroll, Technical Director for Mosman, who has over 35 years of relevant experience in the oil industry. Mr. Carroll is a member of the Society of Petroleum Engineers.
Market Abuse Regulation (MAR) Disclosure
Certain information contained in this announcement would have been deemed inside information for the purposes of Article 7 of Regulation (EU) No 596/2014 until the release of this announcement.
Enquiries:
|
Mosman Oil & Gas Limited John W Barr, Executive Chairman Andy Carroll, Technical Director
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NOMAD and Joint Broker SP Angel Corporate Finance LLP Stuart Gledhill / Richard Hail / Adam Cowl +44 (0) 20 3470 0470
|
|
Alma PR Justine James +44 (0) 20 3405 0205 +44 (0) 7525 324431
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Joint Broker Monecor (London) Ltd trading as ETX Capital Thomas Smith +44 (0) 20 7392 1432 |
Updates on the Company’s activities are regularly posted on its website: www.mosmanoilandgas.com
Technical Glossary
|
BBLs or bbls |
Barrels |
|
BOPD or bopd |
barrels of oil per day |
|
BOEPD or boepd |
barrels of oil equivalent per day calculated on the approximate 1:6 basis of the calorific value of the hydrocarbons, (not based on the price) |
|
MMCFPD or mmcfd MMBTU |
Million cubic feet per day
Million British Thermal Units |
Mosman Oil & Gas #MSMN – Stanley Operations Update
Mosman Oil and Gas Limited (AIM: MSMN) the oil exploration, development and production company, announces an operations update for the Stanley project in East Texas.
Stanley
The average gross production rate in the last week was 210 barrels of oil per day (“bopd”) compared to the daily average gross production for the six months ending 31 December 2020 of 139 bopd.
Stanley-3 and Stanley-4 continue to produce oil without artificial lift. Stanley-3 is averaging a rate of circa 50 bopd (gross) and Stanley-4 circa 120 bopd (gross).
The second-hand pump-jack installed at Stanley-2 is now fully operational, after some initial problems with the motor that required replacing. In the last week this well has averaged over 40 bopd (gross).
A workover on Stanley-1 commenced prior to the installation of an additional second-hand pump-jack that has already been purchased. Flow rates will be advised once stable flow has been re-established.
Based on discussions with Mosman’s JV partners, it is still anticipated that Stanley-5 will be drilled in the second quarter of the calendar year, and after Stanley-1 is fully back on production.
Mosman’s working interest in the Stanley wells varies from 16 to 18%.
John W Barr, Chairman of Mosman commented: “Mosman has clearly set out a vigorous operational agenda for 2021, and the workovers at Stanley are an essential element to maintaining strong production. As stated previously, Mosman has opportunities to participate in several potential wells in 2021. The candidates for drilling include two wells at the Stanley project and other wells in East Texas, including wells at Cinnabar and the Galaxie well. The exact order and timing of wells has not been finalised and depends on the results of completion of the current round of detailed technical work.”
Market Abuse Regulation (MAR) Disclosure
Certain information contained in this announcement would have been deemed inside information for the purposes of Article 7 of Regulation (EU) No 596/2014 until the release of this announcement.
Enquiries:
|
Mosman Oil & Gas Limited John W Barr, Executive Chairman Andy Carroll, Technical Director
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NOMAD and Joint Broker SP Angel Corporate Finance LLP Stuart Gledhill / Richard Hail / Adam Cowl +44 (0) 20 3470 0470
|
|
Alma PR Justine James +44 (0) 20 3405 0205 +44 (0) 7525 324431
|
Joint Broker Monecor (London) Ltd trading as ETX Capital Thomas Smith +44 (0) 20 7392 1432 |
Updates on the Company’s activities are regularly posted on its website: www.mosmanoilandgas.com
Mosman Oil & Gas #MSMN – Six Monthly Production and Operations update
Mosman Oil and Gas Limited (AIM: MSMN) the oil exploration, development and production company, announces its production summary for the six months ended on 31 December 2020 and an operations update.
Falcon-1 producing gas and condensate
The Falcon-1 well at the Champion project commenced commercial production in December 2020. Falcon-1 is now producing approximately 180 boepd (gross). Mosman’s net production is 90 boepd (50% working interest) which is 68 boepd after royalties.
This is a significant well for Mosman, being both the highest gross production well and the highest working interest well in Mosman’s portfolio. The net effect is that daily production rates increase significantly, at this rate more than doubling net production rates compared to the average daily rate for the six months ended 31 December 2020.
Six Month Production Summary to 31 December 2020
During the period there was continued disruption from the pandemic along with the requirement for certain workovers at Stanley, but significantly the Falcon-1 well commenced production.
Net Production attributable to Mosman for the six months was 8,650 boe.
Production Details
Further details are outlined below:
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6 Months to 31 December 2020 |
6 Months to 31 December 2020 |
6 Months to 30 June 2020 |
6 Months to 30 June 2020 |
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Total Project |
Net Attributable |
Total Project |
Net Attributable |
|
|
Gross boe |
Net boe |
Gross boe |
Net boe |
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Falcon* |
– |
– |
– |
– |
|
Stanley |
24,982 |
3,984 |
28,540 |
4,482 |
|
Greater Stanley |
926 |
185 |
485 |
97 |
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Arkoma*** |
– |
– |
1,632 ** |
276 ** |
|
Welch**** |
5,845 |
4,481 |
6,569 |
5,035 |
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Total boe |
31,753 |
8,650 |
37,226 |
9,890 |
Net production means net to Mosman’s working interest before royalties
* Falcon production started on 11 December, but will be reported separately when known in detail
** Figures for five months of the period
*** awaiting production figures for Arkoma
**** Sale of project announced on 4 January 2021
Drilling opportunities
Mosman has an opportunity to participate in several potential wells in 2021. The intention is to participate in drilling at least one well each quarter.
The candidates for drilling include two wells at the Stanley project (where four wells have already been drilled with a 100% drilling success rate) and other wells in East Texas, including wells at Cinnabar and the Galaxie well.
The exact order and timing of wells has not been finalised and depends on the results of completion of the current round of technical work . Drilling and workovers may be funded from existing cash resources, proceeds of sale of assets, as well as other funding alternatives.
The exercise of existing warrants may provide additional funds, and there is also the potential to farmout interests in one or more wells to third parties.
Cinnabar and Champion Projects
Mosman has a 97% working interest (reducing to 85% upon drilling of the first well) in the Cinnabar lease and is now officially recorded as the Operator of the Cinnabar lease.
At Cinnabar, a Third Party Independent Report (1) has identified existing Proven plus Probable reserves of 849,000 barrels of hydrocarbons. Technical work is underway to optimise a field redevelopment of Cinnabar, including further 3D seismic evaluations on Cinnabar to ensure that it is drilled most effectively. The Company is targeting drilling two wells at Cinnabar during the calendar year 2021 subject to funding and other matters. Two wells drilled at Cinnabar in the 1980s are still producing. Flow rates from both these wells were historically over 100 bopd and Mosman anticipates that a similar production profile can be achieved from future wells at Cinnabar.
The Champion project currently consists of two leases. Mosman has a 50% interest in the Falcon lease, and a 60% working interest in the Galaxie lease. The project area has multiple prospects identified by 3D seismic that may be drilled in due course. The largest prospect is Galaxie, and this is likely to be the next prospect drilled. There is some preliminary work required to determine the exact surface location based on existing roads and pipelines, and to plan production infrastructure. The Company is using the current flow rate from Falcon to indicate the potential flow rates at Galaxie.
It is anticipated that a well will be drilled at either Cinnabar or Galaxie in the second quarter of 2021. Each project differs in attributes and costs, and further evaluation is required in order to prioritise and proceed. For example, Cinnabar is predominantly oil, whilst indications are that Galaxie is more likely to be gas.
Stanley
Stanley-3 and Stanley-4 continue to produce oil.
The operator has recently advised that to increase flow rates, a pump-jack has been installed at Stanley-2 and is now operational. A second pump-jack has also been acquired for Stanley-1 and is expected to be installed in the next two weeks.
Based on discussions with Mosman’s JV partners, it is anticipated that Stanley-5 will be drilled after Stanley-1 is back on production. Subject to funding and other matters the Company is also targeting a sixth well at Stanley towards the end of calendar year 2021. Mosman anticipates that future wells at Stanley will have a similar production profile to those already drilled.
Greater Stanley
The workover at Duff-1 was not able to remove the wellbore obstruction required to recomplete in the target zone, and the well was placed back on production. The joint venture now plans to workover the other producing well in another target zone.
Sale of Welch and Arkoma
Mosman has signed a contract to sell Welch (announced on 4 January 2021) with settlement scheduled for 15 January 2021.
As announced, Mosman considers Arkoma to be a non-core asset and it is held for sale.
John W Barr, Chairman of Mosman commented : “Mosman is well positioned for strong production growth in 2021. We are particularly encouraged with the results from Falcon-1 and the cash-flow that will be derived from that well, as we plan the 2021 year and beyond.”
Technical Glossary
|
BBLs or bbls |
Barrels |
|
BOPD or bopd |
barrels of oil per day |
|
BOEPD or boepd |
barrels of oil equivalent per day calculated on the approximate 1:6 basis of the calorific value of the hydrocarbons, (not based on the price) |
|
MMCFPD or mmcfd MMBTU |
Million cubic feet per day
Million British Thermal Units |
(1) This Reserves Report was prepared by a third party independent petroleum engineering firm for Barry Lasker, a Managing Partner at Baja, in June 2017 and conforms to SPE-PRMS petroleum guidelines.
Qualified Person’s Statement
The information contained in this announcement has been reviewed and approved by Andy Carroll, Technical Director for Mosman, who has over 35 years of relevant experience in the oil industry. Mr. Carroll is a member of the Society of Petroleum Engineers.
Market Abuse Regulation (MAR) Disclosure
Certain information contained in this announcement would have been deemed inside information for the purposes of Article 7 of Regulation (EU) No 596/2014 until the release of this announcement.
Enquiries:
|
Mosman Oil & Gas Limited John W Barr, Executive Chairman Andy Carroll, Technical Director
|
NOMAD and Joint Broker SP Angel Corporate Finance LLP Stuart Gledhill / Richard Hail / Adam Cowl +44 (0) 20 3470 0470
|
|
Alma PR Justine James +44 (0) 20 3405 0205 +44 (0) 7525 324431
|
Joint Broker Monecor (London) Ltd trading as ETX Capital Thomas Smith +44 (0) 20 7392 1432 |
Updates on the Company’s activities are regularly posted on its website: www.mosmanoilandgas.com