Vancouver, British Columbia, October 27th, 2016.
Newport Exploration Ltd ("Newport" or "the Company") is pleased to provide an update on activities on Ex-PEL's 91 and 106 in the Cooper Basin, Australia that are subject to the Company's 2.5% gross overriding royalty. This information was reported by Beach Energy Ltd ("Beach") in their Quarterly Report for the period ended 30 September 2016, and reference should be made to Beach's website for their interpretation of results and plans to bring certain wells into production.
The highlights of the Beach Quarterly Report with respect to the permits subject to the Company's royalty are as follows;
- Oil production of 1,085 kbbl (11,800 bopd) was 5% higher than the prior quarter.
- The Bauer-23 development well, which initially produced at in excess of 2,000 bopd, and the Hanson-3 development well, were brought online early in the quarter.
- The Bauer facility expansion progressed, with earthworks complete and all tanks delivered to site. Beach reported that the expansion will increase fluids handling capacity by 60% from 75,000 bfpd to 120,000 bfpd, and is expected to be completed in its quarter ended March 31, 2017.
-Beach commenced its FY2017 operated drilling program with the Hanson-4 development well (as reported in a news release by the Company dated September 8th, 2016). The well is located on the eastern culmination of the Hanson Field, approximately 85 kilometres west-northwest of the Moomba processing facility. Hanson-4 targeted oil bearing reservoirs in the Namur Sandstone and overlaying McKinlay Member, and also assessed potential for reservoir development in the Lower Birkhead Formation. The well was brought online subsequent to its quarter ended September 30, 2016.
-Stunsail-3 was drilled to develop oil bearing reservoirs in the Namur and Mid-Namur Sandstone in the Stunsail Field, which is located approximately 85 kilometres northwest of the Moomba processing facility (as reported in a news release by the Company on October 5th, 2016).The well also assessed potential for reservoir development in the Birkhead Formation. Stunsail-3 intersected two metres of net pay in the Namur Sandstone and four metres of net pay in the Mid-Namur Sandstone. The well also encountered a 15 metre gross interval within the Birkhead Formation with strong oil shows. Beach report that the Stunsail-3 well is expected to be brought online in its quarter ended December 31, 2016.
- Kangaroo-1 was the first Western Flank exploration well of Beach's FY2017 program. As reported in a news release by the Company on October 11th, 2016, the well targeted stratigraphically trapped oil within the Birkhead Formation, approximately four kilometres northwest of the Spitfire Field, which produces oil from the target reservoir interval. Subsequent to its quarter ended September 30, 2016, Beach confirmed Kangaroo-1 as an exploration success following intersection of a 20 metre gross oil column in the Birkhead Formation. Beach reported that a DST over the interval 1,694.5 metres to 1,712.0 metres recovered 41.6 barrels of approximately 52 degree API oil from the drill string following a three hour flow period. Beach report that the results from Kangaroo-1 have the potential to expand the prospectivity across their operated Western Flank permits through de-risking of Birkhead Formation oil prospects and leads. Beach reported that based on preliminary review of results, they intend to bring Kangaroo-1 into production in its quarter ended March 31, 2017 and drill two further wells.
Beach reported that production from Ex-PEL 106 benefited from connection and tie-in of the Ralgnal-1 and Udacha-1 wells in early July, with Ralgnal-1 outperforming initial expectations. Sales gas production was 170 kboe (up 485% from the prior quarter, due in part to Middleton maintenance work undertaken during most of its quarter ended June 30, 2016) and gas liquids production was 80 kboe (up 550% from the prior quarter). Despite significant downtime during July from repair works and shut-in requests from the Moomba gas processing plant operator, total daily production for the quarter ended September 30, 2016 was 2,680 boe (Note: With respect to the disclosure of "BOE's", in accordance with the Standards of Disclosure for Oil and Gas Activities (51-101, 5.14(d)), it should be noted that for the value of this to the Company's royalty payments, BOE conversion is based on an energy equivalent conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.).
This represents an approximate increase of 1,000 boepd relative to average daily online gross production in FY2016. Work continued on the Middleton gas compression project, which will enable greater gas throughput as fields decline. Beach reported that it is targeting peak production capacity of 3,700 boepd and Beach expect it to be brought online in its quarter ended March 31, 2017.
The Company is unable to report on the potential productivity for each well and the Company continues to strongly encourage shareholders and potential investors to access information released independently by Beach and Santos Ltd in order to keep current during the exploration and development of all the licenses subject to the Company's gross overriding royalty.
For further information contact:
Ian Rozier, Director and Chief Executive Officer
+1 604 685 6851
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the accuracy or adequacy of this news release.
Cautionary Statement on Forward-Looking Information
This news release, which contains certain forward-looking statements, is intended to provide readers with a reasonable basis for assessing the financial performance of the Company. All statements, other than statements of historical fact, are forward-looking statements. The words "believe", "should", "could", "expect", "anticipate", "contemplate", "target", "plan", "intends", "continue", "budget", "estimate", "may", "will", "schedule" and similar expressions identify forward-looking statements. These forward-looking statements pertain to assumptions regarding the price of oil, fluctuations in currency markets (specifically the Australian dollar and the U.S. dollar), the future funding of the Company's projects, and the future development of the Company's projects. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, which considered reasonable by the Company, are inherently subject to significant business, economic and competitive uncertainties and contingencies. Known and unknown factors could cause actual results to differ materially from those projected in the forward-looking statements. Such factors include, but are not limited to, the risk of fluctuations in the assumed exchange rates of currencies that directly impact the Company, such as the Canadian dollar, Australian dollar and U.S. dollar, the risk of fluctuations in the assumed prices of oil, the risk of changes in government legislation, taxation, controls, regulations and political or economic developments in Canada, the United States, Australia or other countries in which the Company carries or may carry on business in the future, risks associated with developmental activities, the speculative nature of exploration and development, including the risk of obtaining necessary licences and permits, and assumed quantities or grades of reserves. Many of these uncertainties and contingencies can affect the Company's actual results and could cause actual results to differ materially from those expressed or implied in any forward-looking statements made by, or on behalf of, the Company. Readers are cautioned that forward-looking statements are not guarantees of future performance. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those acknowledged in such statements.
The Company disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise, except to the extent required by applicable laws.