GGE Acquires 20.4% Interest in 87 BCF Boleslaw #1 Well in Poland
GGE Acquires 20.4% Interest in 87 BCF Boleslaw #1 Well in Poland
Perth, Dec 13, 2016 AEST (ABN Newswire) - Grand Gulf Energy Limited ("GGE" or the "Company") (ASX:GGE) are pleased to announce GGE has acquired 20.4% of the Boleslaw Gas Prospect in the Kolo License located in central Poland.

Highlights

- GGE has acquired 20.4% of the high impact Boleslaw gas prospect in the Kolo Licence in central Poland with best estimate unrisked Prospective Resources of 87BCF in two target sands.

- The Well spud on 11 December 2016 and is anticipated to take 24 days to drill.

- Planned TD of 1,500m and expected to cost A$2.8 million

- GGE entry cost (includes its share of drilling costs) is contributing to the earning well costs by paying $600,000 on a "ground floor" basis.

- GGE will also have a 20.4% interest in the Kolo Licence which covers 1,150 square kilometres.

- Poland provides a ready market for gas at competitive prices.

- Other Partners include Prospex Oil & Gas Plc (LON:PXOG)

Boleslaw Prospect

The Boleslaw Prospect was defined on the Kolo License following interpretation of proprietary 2D seismic data in 2014 and is targeting the Santonian (900m) and Deep Cretaceous (1,400m) sandstones. The reservoirs are anticipated to comprise high porosity sands (20-30%).

The well spud on 11th December 2016 and is expected to take 24 days to drill to TD of 1,500 m.

At the Santonian level, Boleslaw is a well-defined, truncation trap bounded by salt on the SW flank and covers an area exceeding 6 km2. The feature is greatly enhanced by the presence of both seismic amplitude and AVO anomalies potentially consistent with the presence of gas and is also characterised by a seismic flat spot which may represent a gas water contact.

The Deep Cretaceous level is also associated with an amplitude anomaly but is considered higher risk as the anomaly is poorly constrained.

Oil and gas shows in multiple wells drilled nearby between 1965 - 1992 provide evidence of a working petroleum system.

A competent person's report commissioned by Prospex, assessed the resource potential to be as follows (refer to following link):
http://www.abnnewswire.net/lnk/59FF8IL1

Market and Economics

If successful and reservoir sands are as predicted the well has the potential to deliver between 20-40 mmcfg/d meaning a successful project can generate significant revenues and deliver robust economic outcomes.

If the well is successful, the Boleslaw gas could be sold into a high BTU pipeline within 10kms or, if it is low BTU (high nitrogen), into a low BTU pipeline via a 90km connection or more likely sold as electricity via a combined heat-power generation facility into the national power grid a few kilometers away. Pricing of gas and electricity in Poland is transparent and provided via the POLPAX market:

The Table following (refer to link below) is extracted from a Prospex presentation and provides an economic summary of the potential value of the Boleslaw prospect for various resource quantities, risks, gas qualities and electricity price scenarios. The presentation can be viewed at:
http://www.abnnewswire.net/lnk/NT810ES7

The conclusion from this work is that the Boleslaw prospect is economically viable through a wide range of risk and gas quality outcomes.

The Kolo Licence

The Kolo Licence is located in the Lodz Trough within the Polish Central Lowlands, c120 km west of Warsaw. The region is well serviced by oil and gas surface facilities as well as the national electricity grid and sits on major European transport arteries.

The Kolo Licence is 1,150 square kilometres in area and is elongated in a NW-SE direction along the strike of the Lodz Trough, a well-known Mesozoic sedimentary basin. This basin is known in Poland by its salt mines (Klodava) but also by important manifestations of oil and gas in shallow water wells.

The JV owns 1,400km of vintage 2D seismic over the license area and shot a further 250km of 2D proprietary seismic data in 2014.

Recent geological studies and interpretation of geophysical data indicates that the Lodz Trough has the potential to contain commercial oil and gas accumulations at deeper and shallow levels in early and late Cretaceous sedimentary reservoir rocks, similarly to hydrocarbon provinces like the North Sea and the Baltic region.

Structure of Acquisition

As a result of the petroleum licence laws in Poland, which do not allow more than one holder of the licence, the Kolo Licence is held by Strzelecki Sp. z.o.o. (Strzelecki) a 100% owned subsidiary of Hutton Poland (UK) Ltd. GGE as part of the acquisition has acquired a 20.4% equity interest in Hutton Poland (UK) Ltd. The other shareholders include Hutton Energy Ltd (30.6%) and Prospex Oil and Gas plc (49%). Strzelecki has also applied for the Kolo West Licence and the Wielun Licence.

Charles Morgan, Chairman of Grand Gulf Energy, is a director and shareholder of Hutton Energy Ltd, Stephen Keenihan, a director in Grand Gulf Energy, is a minority shareholder in Hutton Energy Ltd and Craig Burton is a shareholder in Hutton Energy Ltd. The independent directors of Grand Gulf, Mark Freeman and Allan Boss have assessed the acquisition of the 20.4% interest in Hutton Poland Ltd independently. It has been determined that the acquisition falls below the level of materiality as set out in LR10.1.

Operator

Strzelecki is the licence holder and Operator of the Kolo Licence and the Boleslaw #1 well. Strzelecki has been has been a licence holder and operator in Poland since 2011 and has held a number of licences over time, It now holds the Kolo Licence as well as the application for the Wielun and Kolo West Licences.

To view tables and figures, please visit:
http://abnnewswire.net/lnk/OPNFERC4


About Grand Gulf Energy Limited

Grand Gulf Energy Limited ASX:GGEGrand Gulf Energy Ltd (ASX:GGE) is targeting conventional oil and gas opportunities in the United States. The company listed on the Australian Stock Exchange in February 2006 as Alto Energy International Limited and changed its name to Grand Gulf Energy Limited in June 2007. The name Grand Gulf Energy is derived from the company's operating subsidiary in USA. Grand Gulf Energy has a strong board of directors and management team based in both Perth, Western Australia and Houston, Texas, USA. Grand Gulf Energy is focused on low-risk, conventional oil and gas plays in Louisiana, close to existing infrastructure and close to or within existing oil and gas production. Grand Gulf Energy's strategy is to apply the expertise and new technology (such as 3D seismic) required to deliver a low risk exploration and development portfolio with potentially high rewards. The company is also focused on forming relationships with organizations that can deliver further acquisition and development opportunities.

The company's portfolio of active projects includes the Napoleonville Salt Dome project in Louisiana.

 


Contact

Mark Freeman
Managing Director
T: +61-8-9389-2000
www.grandgulfenergy.com



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