Otto Energy Limited (ASX: OEL) is an ASX listed gas and oil exploration company based in Perth, Australia. The company is focused on North America and currently has oil production from South Marsh Island 71 (SM 71) oil field in the shallow water Gulf of Mexico. The company also has an active exploration program in the Philippines, including the producing Galoc oil field.
On 20th May 2019, the company announced about commencement of production from the Green #1 well on the Lightning field in Matagorda County, Texas. The company has a total of 37.5% working interest that attributes to 28.5% net revenue interest in the leases covering this field.
Now the company is well opened to sales line, and while the operator assesses the optimal rates for production to achieve the maximum economic ultimate recovery, the rates are expected to fluctuate over the next few weeks.
The company has also started a process to develop maiden reserve volumes on the Lightning discovery, which is expected to be reported upon the completion of the initial 60 days running in the period.
Lightning Field, Matagorda County Texas
On 4th February 2019, the company reported that Green #1 had reached a final total depth of 15,218ft MD (15,216ft TVD). The presence of a total net hydrocarbon filled sand was also indicated at an interval of 180 feet, in the evaluated logging data. The historical parameters for production performance in the play trend had been used for the evaluation.
Key personnel’s statement
Matthew Allen, the Managing Director of the company, stated that he was pleased to have the company’s second field on production. The attractiveness of the current non-operated strategy of the company can be determined after looking at the results of both SM 71 and Lightning field’s exploration drilling success.
Trading Halt and Voluntary Suspension
On 15th May 2019, the company requested ASX to put a trading halt on its listed securities with immediate effect, under the listing rule 17.1. The ASX accepted the request and halted the trading of Otto’s securities. The reason stated for the trading halt was a pending announcement regarding the Green Canyon 21 ‘Bulleit’ well.
According to the filing, the halt was to be lifted on 17th May 2019 or when the company releases the information to the market, whichever is earlier.
As on 17th May 2019, the company was unable to disseminate the required information, and it further requested the ASX to put a suspension on its securities under the listing rule 17.2. Presently, the company’s securities are suspended, and it expected to release the pending information prior to the commencement of trading session on 20th May 2019. The company has failed to deliver the information, and with the closure of market (as on 20 May 2019) the securities of the company are still under the voluntary suspension.
The stock of the company has a 52-week high of A$0.082, and the last closing price of the stock was A$0.054 (as on 14th May 2019). The last one-year return of the stock is a negative 22.4%. However, its YTD return stands at 33.27%.
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