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Competent Persons Report for Southern North Sea Assets – Significant gas potential confirmed by independent consultants
Cluff Natural Resources Plc, the AIM quoted natural resources investing company, has received a Competent Persons Report demonstrating prospective resources contained in four of the Company’s licences located in the Southern North Sea.
P2252 (100% Working Interest, Promote) – Lytham & Fairhaven Prospects
· Best Estimate unrisked Gas Initially In Place (GIIP) of 233 BCF of which 132 BCF are estimated as unrisked P50 Prospective Resources with significant upside potential (unrisked P10 case = 479 BCF)
· Previous wells on Lytham and Fairhaven prospects indicated the presence of gas in both the Zechstein and Carboniferous which was not adequately apraised due to various technical failures and historical views on reservoir deliverability which have moved on since the Breagh field was brought into production.
· An additional unrisked 30 BCF of P50 Prospective Resources is associated with the St Annes Lead
· Company expects further upside potential associated with a previously untested Zechstein Carbonate play, which is analogous to producing Zechstein reservoirs in the Netherlands, to be verified in due course.
P2261 (100% Working Interest, Promote) – Clachnaharry and Williamson Leads
· Best Estimate unrisked Gas Initially In Place (GIIP) of 104 BCF of which 63 BCF are estimated as unrisked P50 Prospective Resources with significant upside potential (unrisked P10 case = 247 BCF)*
· The Carboniferous sequence within this licence area is also considered highly prospective based on significant recent discoveries at Pegasus West and Crosgan and has been assessed at ‘play’ level to contain undiscovered unrisked GIIP of 465 BCF (Best Estimate) and unrisked potential gas resources of 270 BCF (Best Estimate)
*NB: These are ‘on block’ totals as the Clachnaharry trap persists outwith the CNR licence area
P2253 and P2248 (100% Interest, Promote) – Highly Prospective Carboniferous Play Geology
· The Carboniferous geology in these blocks is considered to be highly prospective, capable of hosting a number of traps analogous to those discovered at Pegasus West, which tested at more than 90 million SCF of gas per day, and Crosgan
· Assessed at ‘play’ level these licences could contain undiscovered unrisked GIIP of 608 BCF (Best Estimate) and unrisked potential gas resources of 350 BCF (Best Estimate)
The Company’s fifth licence area, P2259, is subject to planned windfarms and as such the Report does not consider the potential prospectivity of this licence.
Ongoing Technical Evaluation
The completion of this Report is one of a series of steps in the evaluation of the CLNR’s Southern North Sea gas assets and its contents will be incorporated into the wider technical evaluation of the licences before any decision is taken as to drilling location(s) or well design.
The Report assesses the resources of the prospects and leads based on legacy reports made available to Axis by CLNR and based on an effective date of 1 November 2015. Additional technical work is required to further confirm the upside potential which is considered to be associated with both the Zechstein Carbonate and Carboniferous plays identified in the Report. This includes the purchase and interpretation of further 3rd party seismic datasets, reprocessing of historical seismic data and the detailed petrophysical analysis of on block and analogue wells to enhance regional knowledge and de-risk specific prospects which emerge from this work.
Commenting CNR’s Chairman and Chief Executive Algy Cluff said:
“We are extremely pleased to present this independent assessment of the prospectivity of our portfolio of Southern North Sea licences. The report confirms the excellent potential associated with previously acknowledged discoveries in the area but also highlights the significant upside that exists within the Carboniferous which was spectacularly demonstrated by the nearby discovery at Pegasus West by Centrica in 2014, which tested at more than 90 million SCF of gas per day.
We continue to develop our understanding of the potential of the Carboniferous and the Zechstein Carbonate plays identified in the Report while working on a detailed appraisal programme for the Lytham discovery to gather the missing data required to de-risk this potential future development.
With no debt or major work commitments, CNR is in a comparatively strong position to take advantage of opportunities which may arise given the challenging oil price environment. Our objective now is to complete the process of attracting the partners required to fully appraise the production potential of these exciting assets.”
