In an operational update I3 Energy (I3E) told investors that production in 2Q21 has averaged 9,142 boepd, which included the impact of routine facility maintenance on third-party facilities.
The independent oil and gas company, which holds assets and operations in the UK and Canada, said production has averaged 9,353 boepd at the A-52-G horizontal well on its Noel acreage in northeast British Columbia which was previously brought on-stream on 17 June.
Additionally, the company said the Marten Hills Clearwater 01-12-075-26W4 well, which was targeting the 25m thick Clearwater C sandstone, was spud on 15 June. The drilling of the well was completed on Wednesday to a maximum true vertical depth of 630m, the group noted.
Eight horizontal lateral sections, for a total of 13,057m in length penetrating the reservoir, were successfully drilled from with operations having progressed ‘on time and on budget.’
All laterals drilled have encountered a clean upper shoreface sandstone, with porosities ranging from 24% to 27%, and oil has been evidenced throughout by oil shows on cuttings.
I3 said the rig has been moved to, and now spud, the second well in this Marten Hills Clearwater drilling programme at 02-12-075-26W4, with drilling expected to finish mid-July.
The Company explained that the tie-in and equipping of the wells is expected to take five days following rig release, with production from both wells anticipated to commence in late July.
Commenting on the group’s operations, Majid Shafiq, Chief Executive Officer of i3 Energy, said:” The reservoir intervals drilled look to have excellent geological characteristics and we look forward to production results later this month. Apart from periods of facility maintenance, production levels in Q2 have consistently been above 9,000 boepd and we look forward to a period of growth over the next two months from incremental operational activity."
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Earlier this month, i3 told investors that its maiden dividend could be paid in July should its share premium account be cancelled which is likely to be confirmed by the end of this month.
Having acquired a large production package at the bottom of the market in 2020, i3 said its assets have outperformed its expectations. As a result, it is reclassifying its previous dividend of $2m as a "special dividend" which will be paid if the court proceedings to cancel its share premium account are successful.
Overall, total revenue from the company’s Canadian assets amounted to £13m for 2020. Meanwhile, profit after tax for the final year ended 31 December 2020 came to £11.7m.
Looking ahead, i3 highlighted that negotiations continue with multiple potential farm-in partners in regard to the Serenity field appraisal drilling programme in the North Sea.
I3’s focus for 2021 will include growing the Canadian business, ensuring the farmout of its UK licences and distributing dividends to shareholders with up to 30% of free cash flow.
Shares in i3 Energy have increased by 70% in value since the beginning of 2021. The stock was trading 6.96% higher in early morning trading at 14.44p following the announcement.
i3E’s is focused on the development of discoveries located close to existing infrastructure and the exploitation of producing fields, whilst maintaining limited exploration exposure.
Majid Shafiq, CEO of I3E said i3’s entry into the WCSB is “to provide a platform to execute on a strategy for the rapid growth of a Canadian onshore production portfolio via M&A.”
Alongside its acquisition of Toscana, i3 has continued to expand its Canadian assets, with CEO, Majid Shafiq, and in particular, has viewed 2020 as “a transformational year.”
In September 2020, the company told investors that it completed its acquisition of all the petroleum and infrastructure assets of Gain Energy for CAD$80m after raising around £29m in August in order to complete its proposed acquisition of the Gain Energy assets in Canada.
i3 Energy also agreed to sell Gain's Saskatchewan portfolio to Harvard Resources Inc. for CAD$45m, c.US$33m, immediately following the completion of its acquisition of Gain.
i3 believes the diversification of its portfolio will add ‘a quality production base to provide internal free cash flow to grow the enlarged group and provide a near-term return to its shareholders.’
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