GAS2GRID LIMITED 28th April, 2016
ACTIVITIES REPORT MARCH 2016 SUMMARY PhilippinesSC 44 currently in 2 Year Technical moratorium until 27th January, 2017
Nuevo Malolos-1 Deepening drilling proposed for second half 2016
Application for the approval to drill and drilling program completed for deepening Nuevo Malolos-1
Nuevo Malolos-1 Deepening documents submitted to the Philippine Department of Energy for approval to drill
Farmout attempts continue but difficult in current low oil price environment as oil companies curtail exploration expenditure worldwide
FranceA judge in the French tribunal has ruled to suspend the decision made by the French Government in 2015 not to renew the St. Griede licence
The French Government has lodged an appeal on the judge's decision with the French "Conseil d'Etat"
A decision of the Conseil d'Etat on whether to allow the appeal is expected in the near future
Gas2Grid Limited is receiving advice on the courses of action that are available to protect its assets
3 new petroleum exploration licence applications being processed
The Philippine Department of Energy ("DOE") approved a 2 year technical moratorium in order to provide sufficient time to complete studies and establish the appropriate completion technology for maximising sustainable oil production that if successful will lead to full oil field appraisal/development.
The Company completed technical work with industry experts. The study analyzed all available technical data and determined a completion technology that will minimize sand and clay production and avert production blockage in order maximize oil production rates. Results of this work recommend that the preferred method to complete the new wells will be with standard industry screens. The installation of screens, as opposed to perforated casing, should maximize and sustain oil production whilst retaining the reservoir sand and producing the clay fines.
Gas2Grid Limited | Level 11, 10 Bridge Street | PO Box R1911 | T +61 2 8298 3688 |
ABN 46 112 138 780 | Sydney NSW 2000 | Royal Exchange NSW 1225 | F +61 2 8298 3699 |
www.gas2grid.com | Australia | Australia | office@gas2grid.com |
Studies have also been completed on the open-hole mud and hydraulic program design in order to minimize formation damage and maintain well-bore stability.
The Drilling Proposal for the Nuevo Malolos-1 Deepening has been submitted to the Philippine Department of Energy for their approval.
The Malolos-5 drilling proposal is being finalized with the proposed well to be sited on the crest of the mapped surface anticline.
The Company, subject to availability of funding, is planning on deepening the Nuevo Malolos-1 well to the two known oil bearing reservoirs tested in Malolos-1. The well is programmed to deviate slightly so as to intercept the oil bearing reservoirs slightly updip from Malolos-1. The new program will incorporate better open drilling technologies to avoid formation damage. It is planned to cut a rock core through the upper oil bearing sandstone and run a suite of electrical logs. The well will then be completed with screens and placed into oil production.
Recent surface geological mapping has also been completed and integrated with previous work leading to a more detailed understanding of the surface geological structure. The crest of the Malolos anticline has been confidently located approximately 2.5 to 3 kilometres south-southwest of Malolos-1.
The Company, subject to availability of funding, would like to drill a new well to test the known oil bearing reservoirs in a crestal location on the anticline. Due to structural uplift all known sandstone reservoirs would be intercepted at a significantly shallower depth on the crest of the anticline, relative to Malolos-1.
The Company is also reviewing the benefits that could be achieved by the stimulation of the upper oil bearing sandstone in Malolos-1.
FarmoutThe Company still considers the best way to fund the full appraisal and development of the Malolos Oil Field is by securing a farmin partner. The Company is still continuing with farmout efforts although this is difficult in the current low oil price regime as oil companies worldwide are curtailing substantially their exploration expenditure. Other funding options will also be considered.
The Malolos Oil Field still represents an attractive investment opportunity despite the recent oil price drop and the immediate effect that it has had on the oil industry Worldwide. The Malolos Oil Field has
a 20.4 million barrel "Best Estimate (P50) Contingent Resource" of good quality, low sulphur crude oil that is located onshore, close to transportation in a country with excellent fiscal terms. This could result in very low development and operating costs which will leave a healthy profit margin, even at the current low oil price.
SC 44 Location on Cebu Island, Philippines Cross-Section: Malolos Oil Field Nuevo Malolos-1 Deepening well location and well trackGas2Grid Limited issued this content on 28 April 2016 and is solely responsible for the information contained herein. Distributed by Public, unedited and unaltered, on 28 April 2016 00:50:29 UTC
Original Document: http://www.gas2grid.com/IRM/PDF/1889/March2016QtrActivitiesandCashFlowReports
