Turner Bayou Operations Update
Brisbane, June 14, 2013 AEST (ABN Newswire) - Pryme Energy Limited (
ASX:PYM) advise the following update with highlights regarding the Turner Bayou Operations.
Rosewood Plantation 21H No.1 (61.53% Working Interest / 46.15% NRI)
The Rosewood Plantation 21H No.1 well, which was recently completed and put online in April, was drilled to a depth of 15,320 feet (4,670 metres) with a “lateral” section, within the Austin Chalk formation, of 4,480 feet (1,365 metres) in length. A slotted production liner was installed in the lateral section.
An investigation by Pryme has revealed that drilling fluids, solids, cuttings and other debris were forced into the Austin Chalk formation during drilling of the well. Pryme believes this has damaged the formation around the well bore and caused the well to significantly underperform. The well is currently flowing at fluctuating rates between 20 and 40 barrels of oil per day (10 -20 barrels of oil per day net to Pryme.)
Legal Action Initiated by Pryme Energy against Signa Engineering Corporation
Pryme’s wholly owned US subsidiary, Pryme Energy LLC (“Pryme Energy”), as operator of the Rosewood Plantation 21H well located in Avoyelles Parish, Louisiana, has initiated legal action against Signa Engineering Corporation (“Signa”) to recover losses in connection with the formation damage and certain costs overruns.
Re-negotiation of debt facility terms
Pryme is currently re-negotiating the terms of their non-recourse credit facility with Macquarie Bank Limited with the re-negotiations expected to be concluded in the coming weeks.
Of priority to Pryme is to consider, design and implement a remediation procedure for the Rosewood Plantation 21H and conduct additional drilling in the project along with repaying the current outstanding loan.
Further details of the revised debt facility will be released once finalised.
“The past months have been challenging for management, shareholders of Pryme and our partners in Turner Bayou. As operator and a major equity owner of the project we have worked diligently to investigate, assess and then act on the series of events that have resulted in our latest well result in the project,” said Justin Pettett Pryme’s Managing Director. “We remain committed to Turner Bayou. Additionally shareholders can be assured that much work is going on the background to execute on the strategic direction outlined at our recent annual general meeting. Further details on this will be released as we further our plan.”
About Indago Energy Ltd
Indago Energy Ltd (ASX:INK) (OTCMKTS:POGLY) is an Australian listed company engaged in oil and gas exploration, development and production. Indago's project portfolio includes liquid rich producing assets together with substantial oil development and exploration acreage in the United States.
The Company's Exploration and Production focus is on high growth oil and gas projects offering scalability of production, cash flows and reserves. Indago currently has several producing projects together with a significant acreage position. The Company's immediate focus is the development of its Capitola Oil Project located in an active region of the Cline Shale resource play along the Eastern Shelf of the Permian Basin, Texas. The project's core development and exploitation opportunities are shallower multiple "stacked" sandstones and limestones to depths of 7,000 feet which are effectively produced from vertically drilled wells. Indago's value driven model is executed through exploiting shallower, well defined intervals with advanced completion and stimulation technology within known produced oil fields together with exposure to the emerging Cline Shale resource play.
Indago's shares are publicly traded on the Australian Securities Exchange (ASX ticker: INK) and also as American Depositary Receipts on the OTCQX (ADR ticker: POGLY).
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