Independent Oil and Gas announces Skipper appraisal well update

Independent Oil and Gas plc ('IOG' or the 'company'), the development and production focused Oil and Gas Company, has provided the following update on the drilling of the appraisal well on the Skipper oil discovery which lies in Block 9/21a in licence P1609 in the Northern North Sea, of which IOG is 100% owner and operator.

Highlights:

The oil viscosity appears likely to be within the 50cP – 150cP range expected by the IOG management, which is significantly better than the viscosity assumed in the Competent Persons Report (CPR) published by AGR Tracs in September 2013. If these oil properties are confirmed in the laboratory tests, which should be completed in September 2016, the development will require fewer wells than previous assumptions in the CPR thereby reducing the base case development costs.

After spudding on 23 July 2016, the well experienced some operational challenges, which were unrelated to the reservoir. This required an early re-spud of the well and therefore an increased overall well duration. In addition to this, in early August we experienced a force 10 gale at the well location which caused a suspension of operations for almost two and a half days for safety reasons. These delays have resulted in an estimated increase in the operational phase of the well by approximately 13 days, the cost of which will be met in the short term by the existing London Oil and Gas loan facilities. Other costs are being deferred until the end of 2017, as previously announced.

The next step of the current well programme is to drill the exploration prospects in the Lower Dornoch and the Maureen formations beneath the Skipper oilfield in which the CPR author has mapped structures which together may contain 46 million bbls in place. Initial results of this exploration drilling phase of the well are expected to be available before the end of August.

Mark Routh, CEO of IOG commented:

"The initial data acquired from the Skipper well, our first operated well, is an excellent result for IOG and operations proceed without any reported safety incidents.

By retrieving the oil samples, the primary well objectives have been fulfilled and we have proved that the oil is moving in the Skipper reservoir. This is a significant step for IOG towards achieving the target of being a company with 100 million boe heading for development, in assets 100% owned as operator. I am immensely proud of the IOG team and extremely grateful for the co-operation and support from all of the contractors involved. The support of our financial backers is of course crucial and it is very satisfying to achieve our preliminary objectives which in turn repays their trust in the management team and our strategy.

We now move on to drill the exploration prospects, where any further oil discoveries would provide additional upside and look forward to analysing the results in order to progress the Skipper field development plan as soon as possible, in parallel with our exciting gas assets in the Southern North Sea."

Read the article online at: https://www.oilfieldtechnology.com/drilling-and-production/17082016/independent-oil-and-gas-announces-skipper-appraisal-well-update/