Vancouver, British Columbia, May 1st, 2019.
Newport Exploration Ltd ("Newport" or "the Company") is pleased to provide an update on production and drilling activities on permits and licences in the Cooper Basin, Australia over which the Company has a 2.5% gross overriding royalty ("GOR"). This information was released by Beach Energy Ltd ("Beach") (ASX: BPT) in their Quarterly Report for the period ended 31 March 2019, dated 30th April 2019, and in a news release dated 1st May 2019.
Beach report that ex PEL 91 oil production increased by 12% to 1,089 kboe. An artificial lift was added at producing well Bauer-30 which increased production from ~300 bopd on free flow to 1,995 bopd on pump. A milestone was also reached with the production of the 20 millionth barrel of oil from the Bauer Field.
Beach report that Western Flank gas and gas liquids production was down 23% to 394 kboe due to a combination of planned maintenance work on CO2 trains at the Moomba gas plant and downtime for expansion of liquids handling capacity at the Middleton facility. The upgrade is in recognition of the high liquids content of Beach's western flank gas and will allow the Middleton facility to peak at 40 MMscfd of raw gas.
Beach report a 14% increase in realized oil price and a 6% increase in realized gas/ethane price for the quarter.
Beach completed a six-well campaign in the Hanson Field (ex PEL 91) which comprised four vertical oil development wells and two vertical oil appraisal wells. Both appraisal wells were cased and suspended as future producers and confirmed the extension to the south of the field where Hanson-7 development well was drilled. Three of the four development wells were cased and suspended as future producers, with two brought on line during the quarter. The Hanson-7 well was a standout, brought on line just 19 days after spud and averaging over 1,600 bopd free flow over its first 30 days of production. Beach expect it to be put on artificial lift in its Q4 FY2019.
Beach's second Western Flank operated rig commenced a seven-well gas drilling campaign with success at appraisal well Lowry-3, which was cased and suspended as a future producer. The well is currently scheduled to be on line late in Beach's Q4 FY2019 and provides increased offtake form the higher liquids content Lowry gas.
BAUER FIELD DEVELOPMENT
Beach has increased the application of horizontal well technologies, targeting the McKinlay and Birkhead reservoirs, with three horizontal wells drilled in Beach's FY2018 and five operated horizontal wells drilled in FY2019. Beach report that horizontal wells drilled in FY2019 show an 8.2x average well productivity improvement over vertical wells for 1.5x the cost.
Beach forecast aggregate 30-day initial production rate of ~7,000 bopd from horizontal wells Bauer-29, -30, -31 and -32.
As detailed in the Beach news release of May 1st 2019, improvements in drilling/connection times means oil production is accelerated.
Positive appraisal results at Bauer and Hanson mean that both fields will be subject to additional appraisal drilling.
Beach's Western Flank Bauer strategy is shown on page 16 of the news release dated May 1st 2019.
WESTERN FLANK GAS (EX PEL 106 AND EX PEL 91)
Following the drilling success at Lowry-3, a seven-well gas appraisal campaign in the core production area commenced in March 2019. The Core Development Area and Appraisal Area on ex PEL 106 and ex PEL 91 are shown on page 17 of Beach's news release dated May 1st 2019.
Reference should be made to the Beach and Santos Ltd. websites for their interpretation of the results and plans to bring wells into production.
The Company receives its GOR from Beach, who is not a reporting issuer in Canada, and therefore, not required to comply with the requirements of NI 51-101 - Standards of Disclosure for Oil and Gas Activities hence, Newport is not able to confirm if the disclosure satisfies the requirements of NI 51-101 - Standards of Disclosure for Oil and Gas Activities, or other requirements of Canadian securities legislation.
The Company is unable to forecast potential productivity for each well and continues to strongly encourage shareholders and potential investors to access information released independently by Beach and Santos to keep current during exploration, development and production guidance for all permits 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 is intended to provide readers with a reasonable basis for assessing the future performance of the Company. The words "believe", "should", "could", "expect", "anticipate", "contemplate", "target", "plan", "intends", "continue", "budget", "estimate", "may", "will", "schedule" and similar expressions identify forward-looking statements. Forward looking statements are statements and information regarding possible developments that are based on assumptions about future economic conditions and courses of action. Forward looking statements in this release include, but are not limited to, statements regarding future plans for wells to be brought online, production rates and costs, and Middleton facility processing. Forward-looking statements are based upon a number of estimates and assumptions that, while considered reasonable by the Company, are inherently subject to business, economic and competitive uncertainties and contingencies. Factors include, but are not limited to, the risk of fluctuations in the assumed prices of oil, the risk of changes in government legislation including the risk of obtaining necessary licences and permits, taxation, controls, regulations and political or economic developments in Canada, 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, and assumed quantities or grades of reserves. 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.
(c) 2019 Newport Exploration Ltd.