Angus Energy has announced that equipment to isolate water zones in its oil well at Brockham in Surrey was ready to be shipped from the US.
In a statement to investors this afternoon, the company said:
“The primary item, which would have taken over three months to be manufactured, has now been sourced more efficiently and cost effectively from another supplier.”
Almost a year ago, Angus promised investors it would be producing oil in 2018 from the sidetrack it drilled into the Kimmeridge limestone.
The company secured retrospective planning permission for the well, which the county council had said was drilled without consent.
But earlier this month, Angus announced that part of the Kimmeridge oil interval was producing water.
Today, the company said :
“Options for logging the well to identify the water zone are being considered to give the best results.”
The statement said Angus would “immediately start rig selection” and submit an engineering programme for approval to partners and regulators.
Angus said the operation would be in two stages: water identification and isolation and production testing.
Angus also announced it was buying the 20% stake in its Lidsey licence in West Sussex held by Doriemus plc.
The deal will cost Angus £467,377, payable in 8.324m shares and includes Doriemus’s 30% working interest in the Lidsey–X2 sidetrack well, drilled in 2017.
The company added that the Lidsey site, near Bognor Regis, was continuing to produce oil. But flow rates were being restricted because of problems with disposal of produced water.
Earlier this month, West Sussex County Council approved planning permission for round-the-clock production from Lidsey.
The latest data from the Oil and Gas Authority shows that the Lidsey well produced 695m3 of oil in the period January-October 2018. The data showed that produced water from the well for the same period totalled 35m3.
“Whilst the well remains commercially profitable in spite of these limitations, the Company also continues to explore all water disposal solutions including water injection to aid production.”
Produced water from Lidsey had historically been injected at Brockham but this has been ruled out in the updated environmental permit.
Angus added that it was beginning a study of potential exploration west of the current Lidsey producing structure. A sidetrack well could be drilled from the existing pad, Angus said.
DrillOrDrop have invited Angus to comment. We will update this report with any response from the company.