Nordic Energy PLC/ Index: ISDX / Epic: NORP / Sector: Oil & Gas
26 November 2013
Nordic Energy PLC (`Nordic' or `the Company')
Technical Updateon Licence 1/13 in the Danish North Sea
Nordic Energy PLC, an oil and gas E&P company focussed on Denmark, Norway, and
the North Sea sectors of the Netherlands and the UK (the Nordic Area), is
pleased to provide an update on its 80% owned Danish Licence 1/13 (`the
Licence'). The Licence, acquired by Nordic during September, 2013, is the
largest exploration and production licence in the Danish North Sea, covering
3,600 sq km.
As detailed in the Company's announcement on 4 September 2013, previous
exploration activities have occurred on the Licence, including two wells
drilled in the 1970s. The results of these activities which identified ten
large prospects were documented by a previous licence holder in two Competent
Person's Reports (`CPR') released in 2010 and 2011, both of which are still in
the public domain.
The Directors of the Company advise that these CPR reports largely cover
different areas (the 2011 CPR does not cover the Licence area, but does include
75% of `Lead A' shown in the table below, and the 2010 CPR covers the whole of
Licence 1/13 as well as additional acreage outside the Licence area) and
different sets of prospects and leads. The 2011 CPR covered a number of
different prospects in an area to the west of Licence 1/13 where a well was
later drilled (`the Luna Well'). The Company has subsequently acquired the Luna
Well data and advises that this data was not incorporated into the published
CPR reports.
Nordic is now in the process of evaluating the prospectivity of the Licence
based on new data. Nordic's technical evaluation of the Licence will be carried
out using a newly acquired pseudo-3D seismic volume and will incorporate the
results from the Luna Well along with other relevant data. The evaluation will
generate updated maps and a new set of volumetrics and risking on a Chance of
Success (`COS') basis for the Licence. As a result of this on-going technical
evaluation new volumes and risk factors could turn out to be higher or lower
than previously assessed in the published CPRs. The Directors anticipate that
the technical update will be released to the market in the first quarter of
2014.
Nordic Energy CEO Rudolf Kleiber said, "Considerable technical data including
11,600km of 2D seismic and various well logs exist for Licence 1/13 in the
Danish North Sea. We are currently applying advanced technologies and
techniques to this data to build a comprehensive pseudo-3D geological model for
the Licence area. We expect the results of this work including volumetrics to
be available in Q1 2014 which will be followed by a new CPR. In addition to
being the largest in the Danish North Sea, the Directors' believe Licence 1/13
has potentially multiple company-making structures which the Company is looking
to systematically de-risk and prove up. I look forward to providing further
updates on our progress in due course."
Further Information
The 2010 CPR deals with prospects and leads contained on the Licence and an
area to the west of the Licence. The prospects and leads located entirely or
partially (25% approximately) within Licence 1/13 are as follows:
Oil MMbbls Gas BCFG
Prospect % Best Est. High Est. COS % Best Est. High Est. COS %
Name
A 25 1,669 5,119 2.3
B 100 352 109 1.5 1,966 6,156 3.5
C 100 331 961 4.3
A Chalk N 100 26 54 7.6
A Chalk C 100 88 208 7.6
A Chalk S 100 21 75 5.4
PP1a 100 462 1,348 1.8
PP1b 100 412 1,658 1.8
PP2 100 444 1,185 1.2
PP3 100 490 1,197 1.2
PP4 100 949 1,916 1.2
The Directors advise that the 2010 CPR more accurately reflects the Licence,
providing a historical review of the area that pre-dates the drilling of the
2012 Luna well. Prior to completion of Nordic's own technical work, the 2010
CPR represents the best presently available public documentation of prospects
and leads on the Licence.
Two wells have been drilled on the Licence by Chevron: the R-1 well, drilled in
1973, and the S-1 well, drilled in 1975. More recently the Erik-1 well was
drilled by Maersk in 2001, a short distance to the east of the Licence, and the
Luna Well in 2012 to the west of the Licence by Noreco. The Directors believe
that the presence of a thin gas bearing Miocene sand in the R-1 well is of
particular significance, proving the presence of hydrocarbons on the Licence
area, and the presence of porous and permeable sands with gas trapped inside.
Similar thin shallow Miocene sands have been developed as commercial gas fields
by Chevron in the northern Dutch North Sea sector and therefore the extent of
these resources is presently being investigated on the Licence as it adds a
potentially new, low risk prospect type to the already established high risk,
high reward Rotliegendes and Pre-Permian potential which is also being
remapped.
In respect of the Luna Well, it is the opinion of the Directors that the well
results indicate that it was not drilled on a valid trap as the Top Rotliegend,
the main reservoir horizon targeted, was encountered much deeper than
anticipated. It was also drilled in a location where, in the Directors'
opinion, migration of hydrocarbons at pre-Chalk level is unlikely.
Nevertheless, the Well encountered strong gas shows in the Tertiary, which were
analysed to contain significant components of nC4 and nC5. This would indicate
that the gas in the Luna Well was derived from a mature hydrocarbon source
rock, most likely in the Central Graben, rather than being of biogenic origin.
The Well also encountered sandstones of the Auk Formation in the short sequence
of Rotliegendes rocks where the Well was abandoned. No indications of basement
rocks or solid Rotliegendes volcanic flows were encountered. Although the Luna
Well was plugged and abandoned dry, the specific results outlined above offers,
in the Directors' opinion, significant encouragement in respect of the
Rotliegendes potential of the Licence, and is expected to improve the COS of
exploratory drilling. Should the Luna Well not have tested a valid trap, the
Directors believe that this could explain the absence of hydrocarbons in the
Rotliegendes. Hydrocarbons that potentially had migrated all the way from the
Central Graben to the Luna Well might also have covered the remaining short
distance (40 km) to fill structures in Licence 1/13. Auk Formation sands found
in the Luna Well's logs might be found further east in 1/13 as well, with
potentially better reservoir parameters.
The Directors of the Company are responsible for the contents of this
announcement.
**ENDS**
For further information please visit www.nordicenergyplc.com or contact:
Enquiries:
Rudolf Kleiber Nordic Energy Plc Tel: +44 20 7283 0179
Patrick Rocholl Nordic Energy Plc Tel: +44 20 7283 0179
Jo Turner Cairn Financial Advisers LLP Tel: +44 20 7148 7900
Liam Murray Cairn Financial Advisers LLP Tel: +44 20 7148 7900
Chris Crawford First Columbus Investments Tel: +44 20 3002 2070
Frank Buhagiar St Brides Media & Finance Ltd Tel: +44 20 7236 1177
Lottie Brocklehurst St Brides Media & Finance Ltd Tel: +44 20 7236 1177