JKX Oil & Gas issue interim management statement for 1st Qtr ending March 2014
· Production from new Elizavetovskoye field in Ukraine commenced in January with flow rates from the first two carbonate reservoir wells exceeding expectations. First well targeting underlying sandstone reservoir is scheduled to spud this month.
· Expansion programme initiated to double Elizavetovskoye plant capacity to 30 MMcfd with completion planned third quarter.
· Successful drilling and completion of development well NN-80 well in the Novo-Nikolaevskoye field in Ukraine.
· Production from Koshekhablskoye field in Russia constrained to 5,000 boepd due to tubing issues in two wells.
· Work on-going to increase the Koshekhablskoye plant capacity to 60 MMcfd by year-end.
JKX Chief Executive, Dr Paul Davies, said:
“The first quarter of the year has seen the start-up of production on the Elizavetovskoye field in Ukraine with excellent results from the first two carbonate wells. We are about to spud the first Elizavetovskoye sandstone well and are seeking to mobilise a second rig to accelerate the drilling programme on the field. In parallel, we are proceeding with the next stage of plant expansion to process the predicted increase in production. The on-going development and appraisal programme on the core Novo-Nikolaevskoye complex is proceeding on schedule with a good production result from the NN-80 well last month and the recently completed well IG-141 currently under test.
“In Russia, production is constrained to around 80% of base capacity by tubing issues in two wells which will be rectified as soon as a suitable rig is mobilised.
“Oil, gas and LPG prices in Ukraine remain strong, although gas realisations have been affected by devaluation of the Ukrainian hrivnya in the period. We anticipate gas realisations in Russia to move slightly higher after the mid-year. Despite the difficult political situation in the east of the country, our operations and commercial activity in Ukraine continue to be unaffected.”