RNS (19 Dec 19) - Final Results for Year Ended 31 July 2019

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RNS (19 Dec 19) - Final Results for Year Ended 31 July 2019

Postby TDB » Fri Dec 20, 2019 3:37 pm

https://www.investegate.co.uk/u-s--oil- ... 0000P2283/

Outlook and post balance sheet events

Prospect development

Developing the oil system model and assessing the East and West Plays continued with additional geochemical and modelling studies devoted to assessing prospectivity for a multi-well development programme on both plays. The large volumes of high-quality data collected during the Eblana-3 drill were integrated with all other data, including geochemical, VSP, geomagnetic and geophysical data. Additional geophysical and geochemical data were also collected. The reprocessing of legacy 2D seismic data is underway and is expected to add substantially to the Company's understanding of the new plays. The process is furthest advanced for the Tertiary East Play, a likely analogue of Railroad Valley's producing Trap Spring field. If geologic assessment continues to provide positive indications, the Company expects it will drill in that location before drilling the Palaeozoic West Play. The Company is fully funded for an East Play drill, based on current assumptions and available information about certain costings. Preparations for submitting the necessary Application to Drill the East Play, including well design and other elements, is advanced.

From an exploration perspective, the risk profiles of the East and West Plays are substantially different in terms of the data currently available, and additional 2D seismic data will be required in order to assess the West Play before drilling.
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Funding, planning and ongoing exploration

The Company has shown itself capable of developing an appropriate forward-looking strategy, raising funds and making significant operational progress. In September 2019, the Company raised $0.37m for working capital, by way of Ordinary Share Placing. Planning for corporate development and a stock market listing continues, but listing remains contingent on producing oil in commercial quantities.

Data collection, analysis and modelling for the East Play is well advanced, and the first prospective drill target is close to being finalised. If drill costings remain as currently indicated, the Company expects to drill in Q4 of 2019 or Q1 of 2020, followed, subject to funding, by a seismic survey of the West Play to develop targets there. Of considerable importance for future exploration success is that the East and West Plays are to a high degree independent in terms of exploration risk. The Board believes that exploring both Plays is the strategy most likely to realise the potential for major discoveries in Hot Creek Valley and ultimately the potential for commercial success.
TDB
 
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