I3 Energy (I3E ) said it has successfully drilled the second well in its Marten Hills Clearwater drilling programme which is expected to be brought onto production later this month.
The independent oil and gas company, which has assets and operations in the UK and Canada, outlined that its drilling operations targeted the 25m thick Clearwater C sandstone.
The London-listed firm successfully drilled eight horizontal lateral sections, for a total of around 12,644m in length, penetrating the reservoir to a maximum true vertical depth of 630m from this wellbore with operations having progressed both 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 via oil shows on cuttings.
The rig is now being de-mobilised and tie-in and equipping of the wells is expected to take five days following rig release, with production from both wells anticipated to start in late July.
Majid Shafiq, Chief Executive of i3 Energy said, “We are very pleased to have successfully completed drilling operations on the first two wells in the Company's Marten Hills Clearwater acreage and look forward to bringing these wells onto production later in July.
He added, "This is the first phase of drilling operations on this acreage and following evaluation of log and production data from these wells, we will program the second phase of drilling which will target an additional seven possible locations."
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Last month, i3 told investors that its maiden dividend could be paid in July. In addition, in recent weeks, i3 Energy noted in an update that production in 2Q21 has averaged 9,142 boepd, with this including 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.
I3 explained that the tie-in and equipping of the wells at Clearwater is expected to take five days following rig release, with production from both wells anticipated to start in late July.
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.
Last week, i3 announced that it had signed a CA$65 million ($53.7million) deal to acquire a package of oil and gas assets in Canada from senior oil and gas producer, Cenovus Energy.
i3 explained to investors that the deal will see the business acquire production of around 8,400 barrels of oil equivalent per day, with proven plus probable reserves of 79.5m barrels.
I3 believe the assets will be materially accretive to its forecast production, NOI, and reserves (around 30%, 20%, and 76%, respectively) in the year following the closing of the acquisition.
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 more than doubled in value since the beginning of 2021. The stock was trading 0.66% higher during late morning trading to 11.4p 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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