Monday 27 May 2024
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KUALA LUMPUR (Jan 10): Sumatec Resources Bhd said CaspiOilGas LLP (COG) reactivated its oil production enhancement programme in the second half of 2017 (2H17), which is expected to push oil production from the Rakushechnoye oil and gas field in West Kazakhstan to 1,500 barrels per day (bbl/d) by end-March.

Sumatec revealed this in a stock exchange filing after announcing that COG general director Saubay Izbassarov has written a field report to inform Sumatec of the reactivation of the oil production enhancement programme.

COG is a unit of Markmore Energy (Labuan) Ltd and is the concession owner of the Rakushechnoye oil and gas field. Under a joint investment agreement inked in 2012, Sumatec is entitled to 100% of the profit for the first two million barrels COG produces, with subsequent profit to be shared on a 50:50 basis between Sumatec and COG.

“We can reasonably expect to produce 1,000 to 1,500 barrels of oil per day of oil from the Upper Jurassic reservoirs within the next 90 days from six wells working over with two workover rigs,” according to COG's field report published in its website.

Sumatec highlighted that the Upper Jurassic reservoirs have the capacity to produce oil at rather attractive rates.

“Another 1,000 barrels of oil per day can be added to the oil production after the completion of 12 well workover by end of August 2018,” it said.

The total oil production can further increase to about 7,500 barrels of oil per day with the drilling of two new deep Triassic wells by end of 2018. “The well locations have been identified and the drilling contract has been awarded as per [our] announcement on June 28, 2017,” it said.

On June 28, Sumatec said COG had awarded four contracts to Industrial Energy Alliance LLP to repair or rejuvenate 12 wells and build six deep exploratory wells. COG also awarded one contract to Pricaspiyskoye Upravleniye Stroitelstva for the reconstruction of the central processing facility and surface facilities. The awarded contracts were valued up to US$55 million.

Sumatec shares closed 0.5 sen or 7.69% higher at seven sen today, giving it a market capitalisation of RM297.69 million.

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