Kistos (KIST ) has reported “extremely positive” results from the drilling of the appraisal of the Vlieland sandstone formation in the Q07 and Q10 blocks, offshore the Netherlands.
As part of its first stage of a four-month drilling campaign, the low carbon intensity energy producer saw a 825m horizontal section drilled by the Prospector-1 after encountering the target formation on prognosis at a depth of 1,562m true vertical depth subsea (TVDss).
The Q10-A-04 A well was flow tested for 5 days between 26th and 31st August 2021 where a maximum stable rate of 3,200 bopd was achieved, which was higher than anticipated. Kistos said the oil will now be sold to a local refinery and is good quality with an API of 33°.
The Company told investors that the Q10-A-04 A well is now shut-in for a pressure build-up and the information obtained, along with reservoir and surface samples taken during the flow test, will be analysed as Kistos prepares a field development plan for this project. To date, 2C resources estimates are forecasted to be between 23.1 - 67.5 mmboe net.
Kistos intends to source its hydrocarbon supplies with the smallest carbon footprint possible. It said it has demonstrated with the design and performance of the existing Q10-A platform that it is capable of keeping emissions to an industry leading minimum.
Having confirmed the viability of this discovery in the Vlieland sandstone, Kistos will examine options to achieve a "best in class" scope 1 and 2 emissions profile, it said.
Kistos said the Q10-A field is currently shut in while annual planned maintenance is undertaken at the TAQA-operated P15-D facility, through which gas export is currently routed.
Production here is anticipated to re-start before the end of September 2021 and prior to the shut-in, production was previously constrained by compressor issues on the P15-D platform.
Shares in Kistos have increased by over 60% in value since the beginning of 2021. The stock was trading 8.09% higher during the late morning at 260.5p following the announcement.
Andrew Austin, Kistos' Interim CEO hailed the “extremely positive results” from the well. He said the Company will now look at its options for developing the field “in the most carbon efficient manner including the use of shore power derived from renewable sources.”
On Tuesday, the Company announced that it had signed an agreement with Infinergy and Windcollectief Noord-Holland to enter into exclusive negotiations to acquire Windpark Ferrum.
The Windpark Ferrum near Amsterdam comprises three wind turbines on the Tata Steel industrial site in IJmuiden. As part of the agreement, Kistos has proposed to reroute gas production from Q10-A and build a compression station adjacent to an existing facility.
The wind farm can produce up to 7MW of electricity and would enable Kistos to supply a material proportion of the power required by the new facility from a renewable source. The Company said this would materially reduce the overall carbon emissions of the new plant.
Austin said the agreement on the Ferrum wind farm demonstrates Kistos’ commitment to the provision of low carbon intensity energy supplies while complementing the gas facility it is seeking to develop at IJmuiden, allowing the group to keep emissions “as low as possible.”
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