TIDMROSE
RNS Number : 7870U
Rose Petroleum PLC
23 January 2017
Dissemination of a regulatory announcement that contains inside
information according to regulation (EU) no. 596/2014 ("MAR").
23 January 2017
Rose Petroleum plc
("Rose", the "Company" or the "Group")
Operations update
Rose Petroleum plc (AIM: ROSE), the AIM quoted natural resources
company, is pleased to provide an update on the operational
activity currently taking place within the Group.
The executive team is currently working on three major fronts:
Oil and Gas, Mining and Exploration in Mexico and the USA and
business development opportunities in Cuba.
Oil & Gas
In the Oil and Gas division, we continue to review potential
opportunities in the US oil & gas sector and, following the
recent news from OPEC and the outcome of the US Presidential
Election, the Board believes the US energy sector has a far more
favourable outlook.
The permitting process of the 3D seismic shoot in the Paradox
Basin in Utah continues to progress well. We have been working
closely with Dawson Geophysical Inc. and HRL Compliance Solutions
Inc. on providing the Bureau of Land Management ("BLM") with the
documentation required for the permits and on completing the
required studies to gain the approval. The permit is expected to be
approved and granted in H1 2017 and we are still planning for the
physical shoot to commence in H2 2017.
The shoot is designed to cover an area of 61 sq. miles covering
the southern-most area of our circa. 90,000 net acres total land
position in the Paradox Basin. The proposed shoot area is the area
of Rose's acreage closest to the acreage that was successfully
developed by Fidelity Exploration and Production (now owned by
Wesco Operating Inc.) which, in Q1 2015, produced an average of
2,100 barrels of oil per day and in 2012 held the record for the
US's highest producing onshore oil well.
Rose's acreage has considerable potential as evidenced by the
resource estimate calculated by independent consultants Ryder Scott
Company ("Ryder Scott") announced on 23 May 2014. Ryder Scott
estimated 100% Gross Volumes Unrisked Prospective (Recoverable)
Hydrocarbon Resources (Estimated Ultimate Recoverable Reserves -
EUR) in the Paradox basin formations of a collective total of mean
1,115.29 MMBO EUR Oil/Condensate and 2,187.46 BCF EUR Gas. The 3D
seismic shoot will go a long way towards having a better
understanding of the potential of the basin, identifying potential
drill targets, and therefore is of significant value to Rose. The
directors of Rose look forward to updating the market on the
progress of the permit application over the coming months.
Mining and Exploration
Mexico
Custom milling of third-party ore continued at the Company's SDA
Mill in Mexico while efforts are being made to identify
joint-venture opportunities that would generate better returns than
custom milling. The focus of this effort is to identify
advance-stage projects located in the vicinity of the SDA Mill and
on which historical mining has taken place, where there is access
to evaluate the mine workings and to conduct confirmation drilling
as necessary, and where the project would sustain a minimum of
3,000 tonnes per month production to the SDA mill.
Several confidentiality/non-disclosure agreements were signed on
prospective underground narrow-vein properties resulting in five
projects having been reviewed. Evaluations are continuing on two of
these projects as preliminary results indicate the potential for
production grades of greater than our in-house estimate of a
cut-off grade of 5.0 g/T gold equivalent for projects of this
type.
One is primarily a gold resource and the other, primarily
silver. Ninety-one (91) samples were collected from the gold
project during two visits which yielded assay results of up to 24.5
g/T Au. Work on this project indicates a complex vein system with a
number of mine openings and efforts continue to understand the
geology. The silver project consists of historic workings on a
single vein. A total of 38 samples were collected during two visits
which yielded results above 6,000 g/T Ag with an average of 919 g/T
Ag. Assay results also yielded gold values up to 0.5 g/T. However,
a historic mill production report indicated a mine grade of 1.25
g/T Au with a recovered grade of 1.0 g/T Au on a lot of 700 tonnes
of ore. Evaluation work is ongoing on these two projects to
determine if a suitable drilling and/or test mining programme is
feasible.
On the Tango project, we are in discussions with the project
partner, Minera Camargo, on the dynamics of initiating the
permitted drill programme to explore the porphyry targets and the
San Agustin vein for gold-silver production, which we hope to be
able to move ahead if agreement on how to proceed with the partner
can be found.
On an administration point, the Company is actively pursuing the
recovery of IVA (value added tax) and tax totalling MX$16.5 million
(circa. US$760,000) from the Mexican tax authority, Servicio de
Administracion Tributaria ("SAT"). Rose has been in detailed
discussions with SAT regarding the reclamation of the sums owed to
Minerales VANE SA de CV, a subsidiary of Rose, dating back to 2013.
We have made significant progress in this process over the past few
months and are confident of a positive outcome.
USA - Uranium
The Company continues to maintain its US based uranium assets on
care and maintenance. The issues surrounding the 20-year withdrawal
of federal lands in northern Arizona in July 2009 continue to
impact these assets. The lawsuit of the National Mining Association
and American Exploration and Mining Association which challenges
the legality of the withdrawal continues to progress through the
9(th) Circuit Court of Appeals in San Francisco, California.
Fortunately, outgoing President Obama declined to convert the
withdrawn area to a National Monument as was recommended by his
administration and incoming President Trump has expressed support
for nuclear energy.
Cuba
Gypsum
The Group's current activity in Cuba was introduced by Earth
Source Investment Inc. in May 2016, who also contributed to and
helped secure the funding for the project.
As announced on 4(th) July 2016, Rose, with the assistance of
its technical team supported by both Grenzebach BSH (GmbH)
("Grenzebach") and GPM engineering ("GPM"), has been negotiating
with Empressa Materiales de Construccion ("EMC"), the local state
company, for the past six months to construct the proposed gypsum
processing and manufacturing facilities to supply the domestic and
Caribbean market with various gypsum products including, but not
limited to, gypsum wall and ceiling panels. Multiple models and
plant facilities have been discussed involving various end products
and production rates and Rose put forward its proposal on the
agreed capacity and products at the end of the year, although the
process is no longer exclusive to Rose. Having been through
multiple versions of both capacity and end product requirements, it
was an extremely challenging process and the Board of Rose would
like to take this opportunity to thank the technical team,
especially Grenzebach and GPM, for their continuing support. We are
now awaiting official response to our proposal and look forward to
updating the market accordingly.
Oil & Gas
As a result of the Group developing good relationships in Cuba,
we have now engaged with the Cuban national oil company, CUPET, and
are in early stage discussions regarding oil & gas licenses. We
feel that the oil and energy sectors in Cuba offer excellent
potential and hope to be able to progress our discussions.
Matthew Idiens, CEO, commented: "We have been making progress on
all fronts and with the change in political regime in the US, we
feel the incoming administration will be very supportive of our
industry and feel the future is encouraging for US energy, both in
terms of oil and gas and nuclear industries. We hope to be able to
announce the granting of the 3D permit in coming months which will
enable us to commence the realisation of the significant potential
value of our Paradox acreage.
"The Mexican mining operations team continue to evaluate
potential JV partners for our SDA Mill with two projects showing
sufficient grade/geology to be of interest.
"Having presented our proposal on the Cuban gypsum project, we
are awaiting the official response and we have opened up discussion
with CUPET in respect of oil & gas licenses, which we hope we
can develop further."
Kristopher K. Hefton, BSc Geology, Chief Operating Officer Rose
Petroleum plc who meets the criteria of a qualified person under
the AIM Rules - Note for Mining and Oil & Gas Companies, has
reviewed and approved the technical information contained within
this announcement.
Rose Petroleum Tel: +44 (0)
plc 20 7225 4595
Matthew Idiens (CEO) Tel: +44 (0)
Chris Eadie (CFO) 20 7225 4599
Jeremy Porter / James Allenby Capital Tel: +44 (0)
Reeve / Liz Kirchner Limited 20 3328 5656
James Pope / Ben Turner Pope Tel: +44 (0)20
Turner Investments 3621 4120
This information is provided by RNS
The company news service from the London Stock Exchange
END
UPDLLLLLDFFXBBD
(END) Dow Jones Newswires
January 23, 2017 02:00 ET (07:00 GMT)
Zephyr Energy (LSE:ZPHR)
Historical Stock Chart
From Apr 2024 to May 2024
Zephyr Energy (LSE:ZPHR)
Historical Stock Chart
From May 2023 to May 2024