THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION.
4 June 2019
IGas Energy plc (AIM: IGas)
("IGas" or "the Company")
Conventional Project Update
IGas is pleased to announce it has received final planning approvals and is moving to the execution phase for a waterflood project, at its existing producing field at Scampton in the East Midlands.
As announced in the AGM Trading Update on 14 May 2019, the Company continues to progress projects in its core conventional business which include additional gas monetisation and water injection.
The Scampton Waterflood Project will convert an existing well to a water injector to increase oil sweep and field estimated ultimate recovery by implementing secondary recovery (water-flood) in the western portion of the Scampton North field.
The recent D&M CPR estimated 239Mbbl of incremental 2P (Probable Undeveloped) reserves for this project and our estimated mid-case project economics have an IRR of over 40% and a NPV of £2.5 million. The total cost of the project is c.£2.0 million, the majority of which will be incurred in the next 12 months, with resultant incremental production of c.100 bopd.
Commenting Stephen Bowler, Chief Executive, said:
"We have a number of attractive projects across the portfolio which continue to mature as we seek to maximise returns on our existing operations and infrastructure, and in this case are pleased to be moving forward with a low-risk opportunity with an estimated IRR of over 40%.
Alongside these production uplift opportunities, we also continue to work up additional appraisal and exploration opportunities to access new fields in our conventional portfolio.
Projects, particularly on existing sites, offer good returns at these oil prices with reduced risk and minimal incremental operating costs and we look forward to announcing future projects in due course."
Ross Pearson, Technical Director of IGas Energy plc, and a qualified person as defined in the Guidance Note for Mining, Oil and Gas Companies, March 2006, of the London Stock Exchange, has reviewed and approved the technical information contained in this announcement. Mr Pearson has 18 years oil and gas exploration and production experience.
For further information please contact:
IGas Energy plc
Tel: +44 (0)20 7993 9899
Stephen Bowler, Chief Executive Officer
Julian Tedder, Chief Financial Officer
Ann-marie Wilkinson, Director of Corporate Affairs
Investec Bank plc (NOMAD and Joint Corporate Broker)
Tel: +44 (0)20 7597 5970
Sara Hale/Jeremy Ellis/Neil Coleman
Canaccord Genuity (Joint Corporate Broker)
Tel: +44 (0)20 7523 8000
Tel: +44 (0)20 7390 0230
Patrick d'Ancona/Chris McMahon