New­port says Beach well tested at 5.8 MMscfd of gas

Stockwatch Daily - - MINES & METALS - Mr. Ian Rozier re­ports

NEW­PORT EX­PLO­RATION Ltd. has re­leased an ex­plo­ration ac­tiv­ity up­date on li­cence sin the Cooper basin, Australia, over which the com­pany has a 2.5-per-cent gross over­rid­ing roy­alty. This in­for­ma­tion was re­ported by Beach En­ergy Ltd. in a news re­lease dated Dec. 6, 2017, and ref­er­ence should be made to its web­site for its in­ter­pre­ta­tion of the re­sults and any plans to bring wells into pro­duc­tion.

Western Flank gas — ex PEL 106

Beach con­tin­ued its fis­cal year 2018 op­er­ated gas ex­plo­ration and ap­praisal cam­paign, which is fo­cused on the South­west Patchawarra (SWP) and Per­mian edge (PE) play fair­ways. The fourth ex­plo­ration well of the cam­paign, Naiko-1, is lo­cated in the SWP play fair­way ap­prox­i­mately two kilo­me­tres north­east of the Mid­dle­ton gas fa­cil­ity. Naiko-1 was de­signed to test vi­a­bil­ity of the gas and con­den­sate sys­tem within the SWP play fair­way in the mid-to-lower in­ter­vals of the Patchawarra for­ma­tion. The well in­ter­sected two me­tres of net pay in the mid in­ter­val and was cased and sus­pended as a fu­ture pro­ducer. An open-hole drill stem test was con­ducted over the in­ter­val 2,692 m to 2,697 m and flowed at up to 5.8 mil­lion stan­dard cu­bic feet (MMscf) per day on a 32/64ths-inch choke at 1,149 pounds per square inch of flow­ing tub­ing head pres­sure.

Pre­lim­i­nary anal­y­sis of test re­sults in­di­cates that Naiko-1 is po­ten­tially con­nected to the Mid­dle­ton field and, as pres­sure is higher than at Mid­dle­ton, will likely add re­serves.

The cam­paign con­tin­ued with the fifth well, Largs-1, lo­cated in the SPW im­me­di­ately south of the Mid­dle­ton gas fa­cil­ity. Sim­i­lar to Naiko-1, the well is test­ing the vi­a­bil­ity of the gas and con­den­sate sys­tem within the SWP play fair­way in the mid-to-lower in­ter­vals of the Patchawarra for­ma­tion. At month-end Largs-1 had reached to­tal depth of 2,284 m and eval­u­a­tion of the well was un­der way. A ver­ti­cal seis­mic pro­file was con­ducted, aug­ment­ing ex­ist­ing re­gional seis­mic data in or­der to en­hance eval­u­a­tion of fu­ture drilling prospects.

As dis­closed by Beach in its news re­lease dated Dec. 5, 2017, its FY 2018 op­er­ated Western Flank gas drilling cam­paign has pro­vided early suc­cesses, with three dis­cov­er­ies from the pro­gram’s first four wells. These in­clude Lowry-1, Crawford-1 and the Naiko-1 dis­cov­ery, which was drilled in Novem­ber, 2017. Beach re­ported that this con­tin­u­ing ex­plo­ration suc­cess in the Western Flank, com­bined with con­tin­ued strong de­mand for Cooper basin gas, has val­i­dated Beach’s de­ci­sion to pur­sue phase 1 ex­pan­sion of the Mid­dle­ton fa­cil­ity.

Daily raw gas ca­pac­ity will be in­creased from 25 MMscf to 40 MMscf through twin­ning of the gas ex­port line from Mid­dle­ton to Moo­nanga. Com­ple­tion by the end of June, 2018, is tar­geted and in­cre­men­tal gas will then be avail­able for sale into the con­tract or spot mar­kets.

Guid­ance

The com­pany re­ceives a gross over­rid­ing roy­alty from the operator who is not a re­port­ing is­suer in Canada, and there­fore, not re­quired to com­ply with the re­quire­ments of Na­tional In­stru­ment 51-101 — Stan­dards of Dis­clo­sure for Oil and Gas Ac­tiv­i­ties. Thus, New­port is not able to con­firm if the dis­clo­sure sat­is­fies the re­quire­ments of NI 51-101

or other re­quire­ments of Cana­dian se­cu­ri­ties leg­is­la­tion. The com­pany is un­able to re­port on the po­ten­tial pro­duc­tiv­ity for each well and con­tin­ues to strongly en­cour­age share­hold­ers and po­ten­tial in­vestors to ac­cess in­for­ma­tion re­leased in­de­pen­dently by Beach and San­tos Ltd. to keep cur­rent dur­ing ex­plo­ration, de­vel­op­ment and pro­duc­tion guid­ance of all the li­cences sub­ject to the com­pany’s gross over­rid­ing roy­alty.

We seek Safe Har­bor.

David Wil­liam Co­hen, Bar­bara Eileen Dun­field, John Merfyn Roberts, Ian Ter­rence Rozier

(NWX) Shares: 92,329,874

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