Mayan (AIM: MYN), the AIM listed oil and gas company, is pleased to announce a new gas discovery at Stockdale Field, Wilson County, Texas as part of its ongoing development activities at the Morris #1 well ('the Well'). The Company has a 60.0% working interest ('WI') and 45.0% net revenue interest ('NRI') in the Stockdale Field.
Further to the announcement of 20 April 2018, the Company has completed the evaluation of an additional prospective zone known as the Escondido Sand formation from 4358'(feet) to 4776' that was identified using the proprietary Quad Neutron Roke tool on the Morris #1 well. Specifically, within this area of interest the Company has identified 20' of net pay with approximately 10' of oil/condensate below a 10' gas cap. The Company estimates 3 billion cubic feet of natural gas recoverable that could, subject to further testing, produce at a rate of ~ 1.3 million cubic feet per day (mmcf/d) gas and 10-11 barrels of condensate per day. The Company will update the market in due course with respect to its plans to test and produce from this zone.
The Escondido Sand formation is in addition to the Upper and Lower Anacacho zones at the Morris#1 well which, as announced by the Company on 20 April 2018, have been acidized and commingled ahead of the commencement of production. Prior to acidising and commingling, 92 barrels of crude oil were recovered over a six hour period from the Upper Anacacho at the Morris#1 well following a spike in gas pressure. The Company is testing the Morris #1 and expects to have initial production figures from the Anacacho zones shortly.These activities form part of a multi-well low cost workover programme being undertaken across Mayan's portfolio of Texan assets to increase net production to 300-500bopd in the medium term.
Additionally, the Company secured the right to use a second salt water disposal well which will both increase disposal (and therefore potential production) capacity and provide back-up in the event of any issue with the primary disposal well.
Eddie Gonzalez, Managing Director, said: "The new zone identified by our technical team speaks to both the quality of personnel that shareholders have working for them and the upside potential in the Stockdale Field. Natural gas is historically a low maintenance revenue stream when volumes are of sufficient quantity and as a result we are excited by the significant volumes that may result from this zone. At current prices of WTI US$67.80 per barrel and Henry Hub Natural Gas of US$2.78 per mcf, 1.3 mmcf/d is equivalent to approximately 50 barrels of oil per day on a price adjusted basis.
"Together with production from the commingled Lower and Upper Anacacho formations, the Morris#1 has the potential to not only become a major source of cash flow for Mayan but could de-risk multiple additional opportunities at Stockdale. With this in mind, the extra salt water disposal well gives us extra disposal capacity to allow us to add more wellbores that are high in potential to the re-work programme we have had much success with so far this year both at Stockdale and at Forest Hill. With so much activity across our Texan assets as well at the Asphalt Ridge heavy oil project in Utah, this is an exciting time for the Company and I look forward to providing further updates on our progress."
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This announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) No 596/2014 ("MAR").