Block Energy (BLOE ) said investors can expect the second well of the group’s 2021 drilling campaign to be spud before the end of the month and that well WR-B1a is currently producing 50 bopd.
During 3Q, well WR-B1a was successfully drilled to a total depth of 2,483m, penetrating 478m in the target Middle Eocene reservoir in the West Rustavi field. Until recently, the well was undergoing clean-up operations to recover drilling mud components from certain fractures.
Block has a 100% working interest in the highly prospective West Rustavi onshore oil and gas field with multiple wells that have tested oil and gas from a range of geological horizons.
Block said the drilling of the well has benefitted from its partnership with Baker Hughes, signed in June this year, as well as the high-quality 3D-seismic data obtained in 2019.
Following the interim installation of a rod pump, which was installed by the company to clean-up operations at the 1R-B1a well, the Georgian-focused production firm said the WR-B1a well has produced an average of 50 barrels of oil per day over the last eight days.
At this rate and current oil price, the WR-B1a well is expected to generate $1m in cash revenue to Block per year, in addition to baseline production estimates outlined last month.
Following the side-track of JKT-01, downhole operations at WR-B1a will resume with a low-cost side-track from the same wellbore to target significant fractures and faults.
Block said these fractures and faults are newly identified from attribute analysis of the 3D-seismic survey, at a higher level within the Middle Eocene reservoir. The attribute analysis has been recalibrated from the significant amounts of data acquired through drilling WR-B1a.
Following the deliberate drilling of WR-B1a into a less fractured zone, Block said a greater understanding of the reservoir has now informed the placement of the JKT-01 wellbore, in order to change the orientation to target the larger fractures observed in the attribute analysis.
Looking ahead, Block said the JKT-01 side-track well is fully-funded and ‘on target’ to commence drilling in the second half of November. The drilling rig is on the newly refurbished wellsite, and undergoing a final planned rehabilitation before drilling operations commence.
The Company highlighted to investors that the analysis of the production data here has indicated that a volume of some 8 million barrels of oil is present in this area of the reservoir.
Commenting on its progress, Block Energy’s Chief Executive Officer, Paul Haywood, said:
“Well WR-B1a has not so far produced at the forecast rate, but we have leveraged the new data gathered from the well to greatly enhance the potential production rates from JKT-01 and subsequent wells. Our technical team’s new attribute analysis also supports the plan to return to WR-B1a, aimed at delivering production more in-line with initial expectations. I encourage you all to watch the video by Stephen James, our in-house expert on fractured reservoirs.”
In September, Block announced that it had completed drilling operations on the “potentially transformative” WR-B1a well which is targeting an estimated 2.1 MMboe of recoverable oil and gas, meaning it will now progress to test the well within the onshore West Rustavi field.
WR-B1 was drilled to a measured depth of 2,180m and encountered higher than expected hydrocarbon shows in the Middle Eocene reservoir. Whilst shows had continued to rise in frequency and magnitude, wellbore stability challenges required this section to be re-drilled.
After encountering multiple shows and indications of hydrocarbon-bearing fracture zones, the well was successfully completed. Drilling operations were also optimised through Block’s strategic partnership with Baker Hughes and the adoption of several drilling technologies.
Block believes that the WR-B1a well, which is targeting an estimated 2.1 MMboe of recoverable oil and gas, is “potentially transformative”. In the event of a commercial well, production from the well will be tied into Block’s Early Production Facility for processing.
Block Energy holds a 100% working interest in the West Rustavi onshore oil and gas field with multiple wells that have tested oil and gas from a range of geological horizons. Block spudded the WR-B1 well at the WR-BA location on the West Rustavi field back in June 2021.
The well is targeting the Middle Eocene reservoir with a horizontal section around 800 metres long for 2.1 MMboe of recoverable oil and gas. WR-BA is the first well to be drilled using the data from Block’s 3D-seismic survey acquired over the West Rustavi licence area in 2019.
Block Energy believes the WR-B1 well at West Rustavi is potentially transformative for the Company, targeting 2.1 MMboe of recoverable oil and gas. If WR-B1 is successful, it will be tied into Block’s Early
Production Facility for processing both oil and gas produced, it said.
In addition, Block believes that its MoU with Baker Hughes will provide a broader partnership on developing significant oil and gas opportunities throughout the group’s entire portfolio.
During Q3, gross production (including the state of Georgia’s share) was 34.6 Mboe (Q2: 42.6 Mboe), comprising 21.0 Mbbls of oil (Q2: 25.7 Mbbls) and 13.6 Mboe of gas (Q2: 16.9 Mboe).
The average gross production rate for Q3 was 376 boepd (Q2: 468 boepd), representing a decrease of approximately 19.7%, which is mainly owing to the decline from well WR-38Z.
It said production included the resumption of production from WR-16aZ, following successful installation of a sucker rod pump, but this was more than offset by the decline from WR-38Z.
As at 30 September 2021, the Company had $2.7m cash at bank (30 June 2021: $5.5 m).
