Tickers: PINX:CANIF, XTSX:ZEE
Tags: Oil & Gas
Calgary, AB / TheNewswire / October 15, 2018 – Zenith Energy Ltd. ("Zenith" or the "Company") (LSE: ZEN; TSX.V: ZEE), the dual listed international oil & gas production company operating the largest onshore oilfield in Azerbaijan, is pleased to announce that it is preparing to commence drilling operations, having finalised a programme to deepen well C-37 in the Jafarli field. This has been based on a series of in-depth geological investigations, including analysis of 2D and 3D seismic lines, which have evidenced a highly prospective, unexploited structure comprised of Upper Cretaceous carbonates formations.
As announced on August 13, 2018, the Company has completed two comprehensive geological studies which have offered a clear overview of the potential drilling opportunities located within the Company’s Azerbaijan asset. Specifically, the study performed in relation to the Muradkhanli and Jafarli fields identified a new, previously unexplored, Mesozoic carbonate prospect running across the two fields beginning from the south-western flank of the Muradkhanli oilfield. In addition, the study also provided a modern re-evaluation of the Eocene age reservoir levels comprised of sandstones, marly limestones and volcanic facies.
Drilling activities in well C-37, Jafarli Field
The Company’s operational team plans to divide drilling activities in two phases. Initially, well C-37’s total depth, 3,987 metres, will be deepened by 15-20 metres into the Middle Eocene formation and a production test will be performed. The Company’s geological and reservoir investigations have indicated that the Middle Eocene formation in this well may hold significant oil reserves. This has been supported by the fact that an adjacent well, C-22, achieved a sizeable rate of production from the interval between 3,902-4,014 metres.
In the event of negative results from the first Middle Eocene target zone, Zenith will proceed with deepening the well by 200-250 metres to test the Upper Cretaceous formation.
Well C-37 Key Facts
– Drilled in 2008 by SOCAR to a total depth of 3,987 meters
– Currently produces at a rate of approximately 5 bopd following the installation of an electrical submersible pump
– Top of Upper Eocene 3,510 meters
– Top of Middle Eocene 3,935 meters
– Top of productive zone 3,925 meters
– An adjacent well, C-22, achieved highly significant production from the Middle Eocene formation
Beginning of Operations in Well C-37
The Company is mobilising its A-80 workover rig to the C-37 well location in order to perform preparatory work for the beginning of drilling activities. These activities will include pulling the electrical submersible pump out of hole and subsequently running in the hole with a scraper to the production casing shoe at a depth of 3,904 metres, as well as performing a series of well investigations by wireline.
The Company will provide an update once the preparatory work is concluded and a 180-ton rig, contracted from a local service company, is mobilised to the well location in order to commence drilling activities.
Zardab Field Operational Update
The Company has decided to prioritise well deepening operations in well C-37 following recent geological and reservoir studies which have confirmed the significant potential for oil production with less complex operations than in Z-21 due to the better condition of the well and the improved reliability of available well data on account of it being drilled in 2008.
As announced on May 18, 2018, the fist operational challenge in Z-21 is the fishing out of 166 meters of 2 3/8" tubing from the wellbore due to an undocumented change in the tubing diameter.
The Company intends to move the 180-ton rig to Z-21 in the Zardab field once operations in well C-37 are successfully completed.
Appointment of Workover and Drilling Manager
The Company is pleased to announce that it has appointed Mr. Ion Tica as Workover and Drilling Manager of Zenith Aran, its fully-owned Azerbaijan subsidiary, effective today.
Mr. Tica is a well operations and engineering executive with over 28 years of international experience in drilling and heavy workover operations. He joins the Company from the Arawak Energy group where he spent more than 10 years working in Azerbaijan and Kazakhstan. He previously worked for 17 years for OMV Petrom in Romania and Kazakhstan in various technical and management positions.
The Company has ended its working relationship with Mr. David Sadoway, announced on July 16, 2018, due to health reasons.
Andrea Cattaneo, Chief Executive Officer, commented:
"I am pleased that we are now in a position to regain momentum with the resumption of intensive operational activities that have the potential to achieve concrete success. I am also delighted to welcome Ion to Zenith at an important time for the Company operationally. We have been through a progressive learning curve, which has included some operational challenges, but at the same time has resulted in an increased understanding of the reservoirs and geology of our asset, as well as a substantive verification of historical well data to the fullest extent possible.
I am excited about our drilling activities in the Upper Cretaceous formation. This is a highly prospective formation which remains significantly unexplored in onshore Azerbaijan. This will be the primary target zone of our drilling programme that we plan to begin following the arrival of the BD-260 drilling rig."
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
For further information please contact:
Zenith Energy Ltd.
Chief Executive Officer
Tel: +1 (587) 315 9031
Vigo Communications – PR Adviser
Tel: +44 (0) 20 7830 9700
Daniel Stewart & Company Plc – (Joint Broker)
Robert Emmet- Corporate Broking
Tel: + 44 (0) 207 776 6550
Optiva Securities – (Joint Broker)
Tel: + 44 (0) 203 137 1903
Allenby Capital Limited – (Financial Adviser)
Tel: + 44 (0) 203 328 5656
Notes to Editors:
Zenith Energy Ltd. is an international oil and gas production company, dual listed on the TSX Venture Exchange and London Stock Exchange.
The Company operates the largest onshore oilfield in Azerbaijan following the signing of a 25-year REDPSA, (Rehabilitation, Exploration, Development and Production Sharing Agreement), with SOCAR, State Oil Company of the Azerbaijan Republic, in 2016.
The Company’s primary focus is the development of its Azerbaijan operations by leveraging its technical expertise and financial resources to maximise low-cost oil production via a systematic field rehabilitation programme intended to achieve significantly increased revenue. Zenith also operates, or has working interests in, a number of natural gas production concessions in Italy. The Company’s Italian operations produce natural gas, natural gas condensate and electricity.
Zenith’s development strategy is to identify and rapidly seize value-accretive hydrocarbon production opportunities in the onshore oil & gas sector. The Company’s Board of Directors and senior management team have the experience and technical expertise to develop the Company successfully.
This news release contains forward-looking statements and forward-looking information within the meaning of applicable securities laws. The use of any of the words "expect", "anticipate", "continue", "estimate", "objective", "ongoing", "may", "will", "project", "should", "believe", "plans", "intends" and similar expressions are intended to identify forward-looking information or statements. More particularly and without limitation, this press release contains forward-looking statements and information concerning the current and future production potential of the Company’s assets. The forward-looking statements and information are based on certain key expectations and assumptions made by Zenith, including the ability to execute its strategy and realise its growth opportunities including its ability to finance and execute its plans. Although Zenith believes that the expectations and assumptions on which such forward-looking statements and information are based are reasonable, undue reliance should not be placed on the forward-looking statements and information because the Company can give no assurance that they will prove to be correct. All timing given in this announcement, unless stated otherwise is indicative and while the Company endeavours to provide accurate timing to the market, it cautions that due to the nature of its operations and reliance on third parties this is subject to change often at little or no notice. By its nature, such forward-looking information is subject to certain risks and uncertainties (both general and specific) that could cause actual events or outcomes to differ materially from those anticipated or implied by such forward-looking statements. These risks and uncertainties, include, but are not limited to, Zenith being unable to finance or realise growth opportunities. Readers are cautioned not to place undue reliance on this forward-looking information, which is given as of the date hereof, and to not use such forward-looking information for anything other than its intended purpose. Zenith undertakes no obligation to update publicly or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as required by law. The forward-looking information contained herein is expressly qualified by this cautionary statement.
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