LGO Bumps Up Recoverable Reserves Target, Development Plans
Leni Gas & Oil plc (LGO) the AIM listed international oil and gas exploration, development and production company, today provides an update on the results of a new interpretation on Ayoluengo remaining potential, a new Ayoluengo recoverable reserves target and update on plans for the development acreage.
- Ayoluengo STOIIP calculated across all four primary reservoir sands totalling 109.7 mmbo.
- Remaining Oil in Place across all four Ayoluengo sands of 92.8 mmbo (85% of STOIIP), ranging from 3.0 mmbo to 53.3 mmbo across the four sands.
- Ayoluengo historical Recovery Factor of only 15%, ranging from 9% to 25% across the four sands.
- LGO increasing the potential incremental recoverable reserves target for the Ayoluengo field from 10% to 15%, equivalent to a new potential target of 15 mmbo.
- Preliminary approval from the regulatory authorities has been issued to further appraise the nearby development prospects.
As announced on April 22, 2008, a full re-interpretation of the Ayoluengo oilfield identified that only 17 million barrels of oil ("mmbo") has been produced from the field with a STOIIP ("stock tank oil initially in place") in the range of 93 - 116 mmbo.
A new study recently completed by Tracs International has mapped all historical production from the field across the four primary reservoir sands in order to identify where secondary recovery techniques would have the largest benefit and also the location of un-depleted zones. The results of this study will primarily be used to refine the planned enhanced recovery programs and increase the chance of success for the forecast production enhancements.
The study results show 90% of the recovered oil to date has been produced from the eastern flank of the field (15.5 mmbo) and an even split of 7.5 mmbo produced each between the primary Ayoluengo and Sargentes reservoir sands. The balance of 1.5 mmbo was from the other sands. The results also show that the main Ayoluengo reservoir has been effectively depleted by primary recovery with some areas particularly around the area of water injection depleted more than would be expected supporting the principle that water injection is beneficial to recovery.
Each primary reservoir sand was assessed to calculate the STOIIP, remaining oil in place and the historical recovery factor. The results are summarised as follows:
- STOIIP = 109.7 mmbo total, allocated 60.9 mmbo (Sargentes sand), 29.4 mmbo (Ayoluengo sand), 15.8 mmbo (Unit A sand) and 3.6 mmbo (Unit C sand).
- Remaining Oil in Place = 92.8 mmbo total (85% of STOIIP) allocated 53.3 mmbo (Sargentes sand), 22.1 mmbo (Ayoluengo sand), 14.4 mmbo (Unit A sand) and 3.0 mmbo (Unit C sand);
- Historical Recovery Factors = 15% total allocated 25% (Ayoluengo sand), 14% (Unit C sand), 13% (Sargentes sand) and 9% (Unit A sand).
The development program for the Ayoluengo oilfield as previously announced has identified five discrete phases to increase production, including one phase of primary recovery in un-depleted zones, two phases of secondary recovery and two phases of well stimulation which will aid both primary and secondary productivity. Recovery factors of 20% for primary depletion and 40% for secondary recovery have been estimated for the Ayoluengo sands.
As reported in the initial determination of STOIIP, the Ayoluengo oil field has multiple stacked reservoir sands and different recovery techniques will be required to maximise the remaining recoverable reserves from all four primary sands. The five phase enhanced recovery program will target maximum primary recovery in the Sargentes, Unit A and Unit C sands, maximum secondary recovery in the Ayoluengo sands and possibly partial secondary recovery in the Sargentes sands.
Based on this new study of remaining oil in place, the historical low depletion in the four primary reservoir sands and the identification of potential new enhanced recovery approaches, LGO is increasing the potential incremental recovery target from the field from 10% to 15%. This represents an increase of 5 mmbo above the previously stated potential target of 10 mmbo incremental recovery to 15 mmbo.
LGO has a 100% interest in the La Lora production concession which contains the Ayoluengo producing oilfield.
As announced on October 21, 2008, 10 prospects were identified across all acreage in Spain with a un-risked total STOIIP of 74 mmb and GIIP ("gas initially in place") of 4bcf. The recoverable prospective and contingent resources across these prospects have a total un-risked mean volume of 12.8 mmboe and are in addition to the new recoverable reserves target for Ayoluengo.
Further to the re-interpretation of these 10 prospects, four have been identified for either extended well testing or detailed imaging surveys in order to accelerate near term development in late 2009 and 2010, summarized as follows:
- Basconcillos H (Tozo) : detailed survey to assess near term gas development
- Huermeces (Hontomin) : extended well test to assess commerciality
- La Lora (Huidobro) : imaging survey to investigate contingent resources prior to drilling
- Valderredible (Ayoluengo NE) : imaging survey to investigate prospective resources prior to drilling
Preliminary approval has already been issued by the Spanish governmental ministries to progress these programs with final permitting due to be completed in Q1 2009.
LGO has an 85% interest in all the Spain Exploration Permits including the Basconcillos H, Huermeces and Valderredible acreage, with Tethys Oil Spain A.B. retaining the remaining 15% equity.
David Lenigas, Executive Chairman, commented: "The production allocation study on Ayoluengo has provided invaluable information on the un-depleted zones across the field and where our enhanced recovery program can be focused in order to maximise incremental production.
"The very low historical recovery factor of only 15% is excellent news and increasing our full field recovery target from 25% to 30% marks a further positive step change in the potential of our Spanish operations, a key part of the overall LGO portfolio."
"We are also now in the final stages of developing and permitting the 2009 work programs for accelerating the developments of four other prospects near to Ayoluengo."
- Leni Sees Goudron Well Flow at 700 Barrels per Day (Sep 17)
- Leni Drills 5th Well in Trinidad Development Campaign (Aug 21)
- Leni Appoints New Finance Director (Aug 07)