Project III Resource Upgrade
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Block Energy plc, the development and production company focused on Georgia, is pleased to announce upgraded internal resource estimates for the Rustavi and Teleti fields.
Combined with the independently audited 2C recoverable resources on the Patardzueli-Samgori field, the total Project III 2C Contingent Recoverable Resource figure for Patardzueli-Samgori, Rustavi and Teleti fields now stands at over 2.77 TCF, with an estimated Net Present Value 10 ("NPV") of USD 1.65 billion.
Internal Resource Upgrade
Following the announcement of the Independent Engineering Report ("IER") by Oilfield Production Consultants ("OPC") on Patardzueli-Samgori, the Company has reviewed and updated its internal estimates for the Rustavi and Teleti fields in line with the methodologies applied by the OPC report.
Both the OPC IER and the Block Energy Internal Contingent Resource report only consider gas volumes within the natural fracture system. Upside exists within the tight matrix in both the Lower Eocene and Upper Cretaceous reservoirs. Both reports were completed according to Petroleum Management Resource System ("PRMS") standards.
The upgraded internal contingent resources for these fields are as follows:
| Field | Reservoir | Recoverable Contingent Resources (BCF) | |||
|---|---|---|---|---|---|
| 1C (Low) | 2C (Mid) | 3C (High) | Mean | ||
| Rustavi | Lower Eocene | 884 | 1,062 | 1,245 | 1,064 |
| Total | 884 | 1,062 | 1,245 | 1,064 | |
| Teleti | Lower Eocene | 149 | 203 | 272 | 208 |
| Upper Cretaceous | 344 | 435 | 530 | 436 | |
| Total | 493 | 638 | 802 | 644 | |
| Total | 1,377 | 1,700 | 2,047 | 1,708 | |
| (Block Energy Internal Contingent Resource Report, Rustavi & Teleti) | |||||
| The full Project III volumes are therefore as follows: | |||||
| Field | Recoverable Contingent Resources (BCF) | ||||
| 1C (Low) | 2C (Mid) | 3C (High) | Mean | Source | |
| Patardzueli-Samgori | 926 | 1,072 | 1,222 | 1,073 | OPC IER, 2024 |
| Rustavi | 884 | 1,062 | 1,245 | 1,064 | Block Energy Internal Report, 2024 |
| Teleti | 493 | 638 | 802 | 644 | Block Energy Internal Report, 2024 |
| Total | 2,303 | 2,772 | 3,269 | 2,781 | - |
| (Project III Recoverable Contingent Resources by Field) | |||||
| Field | Economic Value (Net Present Value 10 ; USD MM) | ||||
| Low | Mid | High | Source | ||
| Patardzueli-Samgori | 227 | 501 | 745 | OPC IER 2024 | |
| Rustavi | 209 | 769 | 932 | Block Energy, Internal Report, 2024 | |
| Teleti | 203 | 388 | 487 | Block Energy, Internal Report, 2024 | |
| Total | 639 | 1,658 | 2,164 | - | |
(Project III Net Present Value 10 by Field and Case)
The development plan for each field in the mid case sees an early production scheme delivering 30 MMCF/d gas production, rising to plateaus of 200 MMCF/d (each of Patardzueli-Samgori and Rustavi) and 100 MMCF/d (Teleti). Development costs are anticipated to be low on a USD/MMCF basis, given the onshore location of the fields and the proximity of sales infrastructure.
Gas quality in all three fields has consistently high CH4 content and no H2S or CO2 detected within the gas tests undertaken to date. The Company has developed fully costed appraisal programmes for all three fields, with a near-term focus on Patardzueli-Samgori in light of the results of the PAT-E1 well drilled by Schlumberger.
New Corporate Presentation
The Company is also pleased to announce publication of a new corporate presentation. No material new financial or other information has been provided. The presentation is available on the Company's website and can be found by following this link: https://www.blockenergy.co.uk/investors/circulars-presentations-and-reports/
Commenting, Paul Haywood, Block Energy Chief Executive Officer said:
"I am pleased to announce upgraded contingent resources across Rustavi and Teleti, which together with the recent IER further confirm our confidence in Project III.
"Project III offers a 2C recoverable contingent resource of nearly 3 TCF, with an NPV of USD 1.65 billion. The Project has the potential for significant gas production rates: 200 MMCF/d for each of Patardzueli-Samgori and Rustavi at plateau, an additional 100 MMCF/d from Teleti, and 30 MMCF/d from early production facilities following the Patardzueli-Samgori appraisal campaign.
"The subsurface team has identified additional prospectivity within the area, which would add further running room to the long-term development of the Project. The recently announced commercial Carbon Capture Storage (CCS) opportunity also highlights the Project's sustainability credentials. Further work is being undertaken on the CCS opportunity and announced in due course.
"Today's announcement underlines the Project's potential to meet Georgia's urgent demand for energy and make a wider regional impact. The proximity of our fields to the South Caucuses Pipeline (SCP) opens up competitive export opportunities in Turkish and Southern European gas markets - including Italy and Greece - through the connection to the Trans Anatolian Natural Gas Pipeline (TNAP) and the Trans Adriatic Pipeline (TAP).
"The farm-out campaign is on schedule with ongoing discussions with a range of interested parties."
Glossary
- bbls: barrels. A barrel is 35 imperial gallons.
- Bcf: billion cubic feet.
- boe: barrels of oil equivalent.
- boepd: barrels of oil equivalent per day.
- bopd: barrels of oil per day.
- Mbbls: thousand barrels.
- Mboe: thousand barrels of oil equivalent.
- Mcf: thousand cubic feet.
- MD: measured depth.
- MMbbls: million barrels.
- MMboe: million barrels of oil equivalent.
- MMcf: million cubic feet.
- TVD: True Vertical Depth.
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