Tickers: PINX:CANIF, XTSX:ZEE
Tags: Oil & Gas
Calgary, AB / TheNewswire / October 20, 2017 - Zenith Energy Ltd. ("Zenith" or the "Company") (LSE: ZEN; TSX.V: ZEE), the dual listed international oil & gas production company operating the largest onshore oilfield in Azerbaijan, is pleased to announce an operational update on wells Z-21 and Z-28 in the Zardab field, Azerbaijan.
The Company's operational team is routinely performing checks on a number of wells across the Zardab field.
The Company has recently carried out an intervention in the Z-21 well, specifically by coiled tubing and wireline, without the use of a workover rig. Well Z-21 had been shut-in since 1988 and no surface pressure had previously been recorded in well inspections.
Well Z-21 has periodically been flowed since the completion of this work, producing at a rate below 5 BOPD with negligible wellhead surface pressure recorded. On account of this low production it was decided not to flow the well for a period of two weeks.
On October 18, 2017, an unforeseen build-up in pressure caused a blowout after the failure of a flange on the wellhead. The Company's field personnel immediately sealed the well and replaced the broken flange. Zenith's environmental team arrived on-site within 15 minutes and the Z-21 wellsite has now been environmentally restored.
A subsequent well test on October 19, 2017 observed that the surface pressure of well Z-21 had substantially increased and stabilised at 30 atmospheres (atm), with a peak surface pressure reading of 90 atm. The Company's operational team views the significant increase in pressure as highly surprising, especially as previous well tests had, as aforementioned, recorded very low surface pressure.
The Company cannot forecast the potential post-workover oil production achievable from well Z-21 on the basis of the high pressure now recorded at this well, but the data strongly confirms that there is significant bottomhole pressure with large quantities of oil to be produced. Well tests will continue to take place until the ZJ-30 180 tonne workover rig, currently engaged in the workover of well Z-28, is scheduled to arrive in November 2017.
Update on high-impact workover of well Z-28
The Company is pleased to provide an update on the workover of well Z-28. This is the most significant workover that the Company has undertaken since Zenith began operations in Azerbaijan.
Well Z-28 has been cleaned out with all tubing removed to a depth of 2922 metres. The next task is to perform a well cleanout down to the liner top at a depth of 3568 metres. The Company's petroleum engineers are regularly examining data collected from the well in order to clean out the liner and maximise the potential success of the workover. A quad neutron log has been run to the depth of 2922 metres, providing the most advanced well log recorded in the Zardab field. Whilst this technology has not yet been run through the productive series of the well, it has provided highly valuable information that is now being analysed.
Mike Palmer, Chief Operating Officer, Zenith Aran, the Company's Azerbaijan-based fully owned subsidiary, commented:
"Zardab is a young, hugely unexploited field with original high reservoir pressure. The blowout at Z-21 confirms Zardab's vitality and abundance in oil. I have had a lot of oilfield surprises in my 37 years of activity in the industry, most of them bad. The very high pressure generated without warning in Z-21 is not only a surprise, but a complete shock. Indeed, I was fortunate enough to view this first-hand whilst on location. Our small, inexpensive and systematic well interventions are paying off. There is a lot of work to be done before we can produce the well, but we expect a successful workover of Z-21 to generate significant production.
I am pleased with the rapid progress achieved at Z-28. This is a challenging workover and we have been able to overcome all the problems that we have encountered. The next few weeks will be slow and difficult, but we are confident that we can get the job done successfully. We have assembled one of the most talented operational teams in the region."
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
For further information, please contact:
Zenith Energy Ltd.
Andrea Cattaneo
Chief Executive Officer
Email: info@zenithenergy.ca
Tel: +1 (587) 315 9031
Fax: +1 (403) 775 4474
Optiva Securities - (Joint Broker)
Christian Dennis
Tel: + 44 (0) 203 137 1903
Beaufort Securities Limited - (Joint Broker)
Jon Belliss
Tel: +44 207 382 8300
Allenby Capital Limited - (Financial Adviser)
Nick Harriss
Nick Athanas
Richard Short
Tel: + 44 (0) 203 328 5656
Yellow Jersey (Financial PR/IR)
Tim Thompson
Tel: +44 (0) 203 735 8825
Forward-Looking Statements
This news release contains forward-looking statements and forward-looking information within the meaning of applicable securities laws. The use of any of the words "expect", "anticipate", "continue", "estimate", "objective", "ongoing", "may", "will", "project", "should", "believe", "plans", "intends" and similar expressions are intended to identify forward-looking information or statements. More particularly and without limitation, this news release contains forward-looking statements and information concerning the current and future production potential of the Company's assets. The forward-looking statements and information are based on certain key expectations and assumptions made by Zenith, including the ability to execute its strategy and realise its growth opportunities including its ability to finance and execute its plans. Although Zenith believes that the expectations and assumptions on which such forward-looking statements and information are based are reasonable, undue reliance should not be placed on the forward-looking statements and information because the Company can give no assurance that they will prove to be correct. By its nature, such forward-looking information is subject to various risks and uncertainties, which could cause the actual results and expectations to differ materially from the anticipated results or expectations expressed. These risks and uncertainties, include, but are not limited to, Zenith being unable to finance or realize growth opportunities. Readers are cautioned not to place undue reliance on this forward-looking information, which is given as of the date hereof, and to not use such forward-looking information for anything other than its intended purpose. Zenith undertakes no obligation to update publicly or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as required by law.
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