Block Energy plc recorded a rise in gas production and hydrocarbon prices seeing the company maintain a strong cash balance from its operations in West Rustavi, Georgia.
In its operational review of Q2 2021, the company said WR-B1 well on the West Rustavi field targeting 2.1 MMboe of recoverable oil and gas, had materially boosted production.
Block also continued to plan its second well with the location and timing yet to be finalised.
More than 170,000 operational man hours were worked during the period under review, with no lost-time incidents.
The company was also admitted into the UN Global Compact network.
PRODUCTION
During Q2 2021, Block produced 25.7 Mbbls of oil (Q1: 29.8 Mbbls) and 16.9 Mboe of gas (Q1: 14.6 Mboe), resulting in a combined total of 42.6 Mboe of oil and gas (Q1: 44.4 Mboe).
The average production rate for Q2 was 468 boepd (Q1: 493 boepd), which represents a decrease of approximately 5%.
Block said that although WR-38Z was on production for the whole of Q2 compared with only two months in Q1, this was outweighed by the natural decline of the wells.
SALES
Block sold 15.6 Mbbls of oil (Q1: 26.3 Mbbls) for $960,000 (Q1: $1,370,000), resulting in a weighted average price of approximately $62 per barrel (Q1: $52 per barrel), which represents an 18% increase in the realised price in Q2 compared with Q1.
At the end of June 2021, the company sold 13.5 Mbbls of oil for which the revenue of $149,000 is included in the Q2 sales revenue of $960,000.
Q2 2021 saw Block’s first full quarter of gas sales with 64.6 MMcf of gas (Q1: 38.4 MMcf) for $209,000 (Q1: $123,000), resulting in a weighted average price of approximately $3.24/Mcf (Q1: $3.20/Mcf).
At the end of Q2, the company had $5.4m (£3.9m) cash at bank (Q1: $6.8m).
The company ended the quarter with $5.4 million (£3.9m) cash at bank
Block Energy and Baker Hughes also agreed to deploy energy-efficient technologies for oil and gas production and to evaluate geothermal projects in Georgia.
PLANS
The company’s portfolio comprises 159 wells across five production sharing contracts covering 2,622km2. Production management of old and new wells, including intervention operations, will continue throughout 2021 to arrest natural production decline across all of Block’s wells.
Block continues its well maintenance, intervention and production enhancement programme for 2021, following well by well opportunity reviews held earlier in the year.
Additional interventions planned for Q3 include WR-38Z to improve oil and gas production from the well, KRT-39 to monetise associated gas production that was previously flared and WR-16aZ which has been shut-in for most of the first half of 2021.
Block Energy’s chief executive Paul Haywood said the company had delivered its key objective of spudding WR-B1 well which would provide a material boost to production in Georgia.
“The WR-B1 well will also play a vital role in the second well in the campaign as we will look to use critical WR-B1 drilling information to mitigate risk and optimise the programme of the next well.
“Beyond the drill bit, execution of the baseline production enhancement plan has made solid progress throughout Q2 and we look forward to seeing the results of the team’s hard work as the company moves through an active drilling and workover period in Q3.”