Industry

Angus explains Lidsey oil disappointment and compares Kimmeridge to leading US oil field

Lidsey X2

Angus Energy has given more details about problems at its Lidsey oil site near Bognor Regis in West Sussex. It also likened one of Lidsey’s source rocks to the Bakken oil field in North Dakota.

Last week, the company announced initial flow rates of 40 barrels of oil per day (bopd) from the Great Oolite section of its new sidetrack well at Lidsey. This was significantly lower than the 400 predicted by managing director Paul Vonk during an interview in July and the Xodus forecast of 279 bopd in November 2016. DrillOrDrop report

In a statement to investors this morning, Angus said the well had experienced significant gas locks, causing the pump to fail. Gas locks, explained by Schlumberger, happen when compressible gas interferes with the proper operation of valves and other pump components, preventing the intake of fluid.

Angus said it had installed a different pump, which did not fail. But the company said:

“Every six hours the rate declined significantly with bubbly oil recovered to surface even though production is above bubble point.”

It added:

“Angus Energy has put in place a comprehensive diagnostic program with the help of external experts to make all necessary repairs and adjustments to further conventional oil production at Lidsey and increase yield from Lidsey-X2.”

“Good potential for Kimmeridge”

The statement and a presentation to investors also released results of tests on the Kimmeridge formation from the sidetrack, Lidsey-X2.

Angus said the total organic content (TOC) values, historical temperature (Tmax) and hydrogen index (HI) in the Kimmeridge were similar to those at the Brockham and the Horse Hill wells in Surrey and comparable with the Bakken Shale formation.

171120 Angus Energy Lidsey potential

Extract from Angus presentation to investors, 20 November 2017. Source: http://www.angusenergy.co.uk/wp-content/uploads/2017/11/Lidsey-Geochemical-Analysis-Update.pdf

According to the presentation:

“The geochemical properties of the Kimmeridge at Lidsey are similar to that at Brockham, and at Horse Hill (which has already flowed oil from the interval).

“Comparison with the analogous naturally fractured Bakken Shale play in the USA indicates a good potential for the Kimmeridge in the Weald Basin.”

Question of fracking?

Oil production in the Bakken became economic with the use of horizontal drilling and hydraulic fracturing. Production boomed after 2000 and by the end of 2010 rates had reached 458,000 bopd.

But Angus said in today’s statement:

“The Bakken formation is a hybrid reservoir like the Kimmeridge in that it has fractured limestones which enable natural production. It is therefore a close analogue to the Kimmeridge in both the generation of oil and how it can be produced.”

The statement did not refer to fracking but the presentation said:

“Although thinner at Lidsey, the naturally fractured micrite limestone beds seen at Brockham and Horse Hill are present, and offer the opportunity to develop the interval using conventional methods (no hydraulic fracturing required).”

Earlier this month, UK Oil and Gas announced that the first zone of the Kimmeridge to be tested at its Broadford Bridge well in West Sussex would not be commercially viable without reservoir stimulation.

Angus also said today there was confirmation that other source rocks at Lidsey, the Oxford and Lias, “compare favourably” for organic content and oil generation. It said it would now seek permission from the Oil and Gas Authority for permission to begin production appraisal of the Kimmeridge and Oxford layers at Lidsey.

Share values

171120 Angus Energy share price

Angus Energy share movements, 20 November 2017. Source: London South East.

Shares in Angus fell 41% (11p) on Friday after the statement about the flow rate from the Great Oolite. Today’s statement lifted the share price initially but it later fell back to close up just 2.4% at 16p.

 

 

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