Valeura Announces Second Quarter 2019 Results and Positive Production Test Results at Inanli-1
CALGARY, ALBERTA / ACCESSWIRE / August 12, 2019 / Valeura Energy Inc. (TSX:VLE)(LSE:VLU) ("Valeura" or the "Company"), the upstream natural gas producer focused on appraising and developing an unconventional gas accumulation play in the Thrace Basin of Turkey in partnership with Equinor, is pleased to report its financial and operating results for the three month period ended June 30, 2019, and to report a positive production test at the Inanli-1 appraisal well, where the Company has successfully flowed natural gas from the first stimulated zone.
Highlights from Q2 2019 and beyond
- Achieved a safety milestone of 801 days of continuous operations without a lost time incident;
- Q2 2019 average production of 700 boe/d, down 5% from Q2 2018 and down 9% from Q1 2019;
- Q2 2019 operating income of $1.8 million was 20% higher than Q2 2018 and 21% lower than Q1 2019;
- Q2 2019 average realised gas price of $8.54/Mcf, 15% higher than Q2 2018 and down 7% from Q1 2019;
- BOTAS reference gas price increased 15% on August 1, 2019, equivalent to $10.35/Mcf;
- Net working capital surplus of $52.3 million at June 30, 2019 ($56.1 million at March 31, 2019);
- Completed drilling operations on the Devepinar-1 appraisal well safely and well under budget.
Highlights from Inanli-1 Appraisal Well Testing
- A 21 metre gross interval, between 4,263 and 4,284 metres was stimulated;
- The well has been flowing since August 3, 2019 and is still cleaning up using artificial lift;
- Gas flow is currently stable and the average rate for the first eight days of production is 643 Mcf/d;
- Water is currently being recovered at a low rate of 44 bbls/d and has continued to decline daily;
- Condensate-gas ratio is low in this zone at 5 bbl/MMcf.
The Company's focus for Q3 and Q4 2019 is to continue testing the flow potential of the significant, interpreted gas columns encountered in its new appraisal wells to de-risk the commerciality of its 10 Tcfe (286 BCM) of unrisked gas resource, including 236 MMbbl (32 MMTonnes) of condensate, net to Valeura. The stimulation and production testing is being conducted on a zone-by-zone basis to provide more definitive flow characteristics. Identifying specific zones that can sustain gas flow will be important to demonstrate the commerciality of the Company's Basin Centred Gas Accumulation ("BCGA") play and will underpin the work programme for the next stage of appraisal.
Sean Guest, President and CEO commented:
"I am very pleased with our second quarter results. Price realisations and operating netbacks remain strong and are getting stronger with the recent increase in BOTAS' reference price. At the same time, our team has done an excellent job offsetting natural declines and maintaining production from our conventional shallow reservoirs, which is helping to preserve our strong financial position, including our net working capital surplus of $52.3 million.
"These favourable netbacks help illuminate the long-term economics for gas production in Turkey. Meanwhile, the substantial value of our BCGA play is becoming clearer with every step of our appraisal programme. At the Inanli-1 well, we have stimulated the deepest reservoir zone ever tested in the BCGA, and initial results have been very encouraging with a good, stable gas flow and minimal water production. We are excited by the indications of potential commerciality at this depth and look forward to the results from shallower zones."
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SOURCE: Valeura Energy Inc.
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