Ascent Completes New Gas Producer in Hungary
Ascent Resources successfully tested and completed the PEN-101 well, in the Penészlek area of the Nyírség exploration permits in eastern Hungary. Once the rig has departed the site, the PEN-105 well will commence production to sales.
The completion of the PEN-101 well is, as planned, in a Miocene gas bearing formation within a structure defined on the 3D seismic acquired in 2008. Initial production rates achieved during preliminary testing exceeded 1.0 MMscfd (28.3x103 Nm3/day), and productivity is expected to be improved in the coming days by the use of small scale acid stimulation, similar to that used with good results on the PEN-105 well.
The PEN-101 well is located at the site of the production facilities that will be used to produce both it and the PEN-105 gas discovery. Production from PEN-105 is expected to commence during the week of March 15, 2010, following the departure of the rig and the granting of operating approval for the facilities from the Mining Authority.
The rig will then move to the PEN-104 location to continue the testing of the PEN-104AA sidetrack and, subsequently will continue drilling the PEN-106 well. The PEN-106 well targets a structure that is similar to that proven by the PEN-105 well.
The Penészlek Project has been a successful investment for Ascent and following Leni Gas & Oil's relinquishment of its interest (announced by LGO on March 5, 2010), it has been distributed among the remaining project partners in proportion to their prior interest in the project, at no additional cost to them.
Ascent's Managing Director Jeremy Eng commented, "The recommencement of production in the coming days and the increased share of revenue that Ascent and its partners now stand to gain following LGO's decision to exit the project is an excellent outcome for Ascent. The Penészlek Project is a good example of the onshore conventional gas production projects targeted by Ascent across Europe. These types of projects benefit from low development and production costs, and with deregulated gas prices, provide a relatively high return on investment. In addition to our successes in Hungary, we will shortly be able to provide an update on the re-drill of the Fontana-1 well in Italy, which is drilling ahead at a depth of over 400m."
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