News Releases are added to our web site immediately upon release to the general public. If you would like to receive news releases via e-mail please click here.

News Releases


Aug 21, 2019

BEACH REPORT RECORD PRODUCTION, INCREASED RESERVES, FY2020 APPRAISAL STRATEGY FOR THE BAUER FIELD, AND DRILLING FOR FY2020 IN THE COOPER BASIN, AUSTRALIA

Vancouver, British Columbia, August 21st, 2019. Newport Exploration Ltd ("Newport" or "the Company") is pleased to provide an update on operations and reserves on licenses in the Cooper Basin, Australia over which the Company has a 2.5% gross overriding royalty ("GOR"). This information was reported by Beach Energy Ltd ("Beach") (ASX: BPT) in news releases dated 19th August, 2019, and reference should be made to their website for their interpretation and guidance.

Beach report reserves and contingent resources as at 30 June 2019. Categories presented for reserves on the Western Flank (which includes ex PEL's 91, 106 and 107, as well as for ex PEL 92 which is not subject to the Company's GOR), are 1P reserves (Proved) and 2P reserves (Proved and Probable). Reported reserves have been independently audited by RISC Advisory in accordance with the definitions and guidelines contained within the Petroleum Resources Management System (PRMS) as set out in SPE Reserves Auditing Standards in Australia.

Beach state that since reporting reserves as at 30 June 2018 there have been material changes to reserves driven by drilling, reservoir performance and cost reduction in the Cooper Basin based on existing well performance and new well locations identified across various fields. The revision of 2P reserves is due to improved well performance and the successful application of horizontal drilling technology.

Beach's reported strategy in FY2019 yielded extensions of the Bauer and Hanson oil fields and the Lowry gas field in the Western Flank, identifying additional drilling opportunities. Extensive further exploration and development work is proposed by Beach in FY2020.

SUMMARY OF WESTERN FLANK OIL OPERATIONS

The successful application of horizontal drilling technology targeting the McKinlay and Birkhead reservoirs helped increase net oil production to 5.2MMbbl, a 10% increase over FY2018.

Beach report that horizontal wells have the potential to add substantial value as they are over eight times more productive than vertical wells. Beach plan to increase the number of horizontal development wells in FY2020, with 16 being proposed.

A five well Bauer oil development campaign was completed with a 100% success rate in the fourth quarter FY2018. The aggregate 30 day initial production rate from four horizontal wells drilled on the Bauer was approximately 7,000 bpd.


The Hanson-7 oil development well confirmed a southern extension to the field. The well had a strong initial flow rate of 2,600 bopd and was converted to artificial lift at the end of FY2019 to bring forward production.

Highlights from the Beach Annual Report dated 30th June 2019 and from their FY2019 Full Year results as reported on 19th August 2019 are as follows;

Production

- Record oil and gas production of 7.1MMboe, up 16% vs FY2018
- Oil production increased 10% from FY2018

Reserves

- Oil and gas had total 2P reserves revision of 22MMboe
- This represents a 309% reserves replacement ratio
- 2P reserves now at 42MMbbl, up 7% from FY2018
- 2P reserves life increased from 7.0 years to 8.2 years

Drilling

- 34 oil wells were drilled in FY2019, including eight horizontal wells.
- 6 horizontal wells were being operated in FY2019
- Productivity of horizontal wells averaged 8 times higher than vertical wells
- Drilling and production rates improved

Appraisal Strategy

- Four step-out appraisal wells discovered an easterly extension to the Bauer Field
- Successful oil appraisal programs in Bauer and Hanson fields and resulted in field limits being increased
- Field extensions were also delineated at the Lowry gas field
- Further appraisal wells are planned at Bauer to define field structure and full field development
- In FY2020 Beach plans on drilling 8 appraisal wells at Bauer and 15 development wells, including 7 horizontal wells
- Follow-up appraisal of the Hanson and Kalladeina-Congony complex.

Record Production Targeted for FY2020

- Beach are targeting 20,000+bopd production rate from PEL91/92 in FY2020
- Beach are targeting 84 wells in FY2020, up from 42 in FY2019 and 26 in FY2018

Infrastructure Development

- Beach propose to make significant investment in infrastructure expansion to handle high fluid volumes in anticipation of increased production from more wells and debottlenecking to unlock production

Record Investment in FY2020

- Beach propose to spend $200M in FY2020
- Up to 77 oil wells to be drilled, including 36 exploration and appraisal wells, and 41 development wells (including up to 17 horizontal wells)

SUMMARY OF WESTERN FLANK GAS OPERATIONS

Production

- Beach report a 35% increase in Production over FY2018

Reserves

- Beach report 2P reserves now at 16MMboe (an increase of 8MMboe over FY18)
- Lowry field is a high liquids content gas field (50 bbl/mmscf)

Exploration

- Successful gas exploration/appraisal programs in Lowry and Udacha South fields extended field limits from previous 2P reserves mapping in FY2019
- There is the potential for further appraisal drilling at Lowry and Middleton in FY2020
- Also in FY2020 Beach propose to drill 3 to 5 prospects delineated by a Spondylus 3D seismic survey to extend the proven stratigraphic play and test new exploration plays, with the aim to increase reserves at Middleton

Infrastructure Development

Liquids handling capacity was expanded at the Middleton facility increasing the new facility's raw gas capacity to 40MMscfd.

Guidance

The Company receives its gross overriding royalty from Beach, who is not a reporting issuer in Canada, 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.

Beach prepares its petroleum reserves and contingent resources estimates in accordance with the Petroleum Resources Management System (PRMS) published by the Society of Petroleum Engineers. All estimates of petroleum reserves and contingent resources reported by Beach are prepared by, or under the supervision of, a qualified petroleum reserves and resources evaluator. Beach has engaged the services of RISC Advisory to independently audit Beach's petroleum reserves estimates prior to Beach reporting any updated estimates.

The Company is unable to forecast potential productivity for each well on and continues to strongly encourage shareholders and potential investors to access information released independently by Beach and Santos Ltd to keep current during exploration, development and production guidance 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
info@newport-exploration.com
www.newport-exploration.com
www.beachenergy.com.au
www.santos.com

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 may pertain to assumptions regarding the price of oil and fluctuations in currency markets (specifically the Australian dollar). Forward-looking statements are based upon a number of estimates and assumptions that, which are 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.