Otto’s Share Skyrocketed On ASX After Its Lightning Well Delivers Significant Gulf Coast Discovery

Otto Energy Limited (ASX:OEL) is into the business of oil and gas exploration and production. The Company has an active development and exploration program in the Philippines, including the producing Galoc oil field, and is also targeting opportunities in East Africa.

The company has disclosed on ASX that the initial exploration well named as Green #1, has reached a final total depth of 15,218ft MD. Via the participation in the drilling of the Lightning exploration well, the company has earned a stake of 37.5% in the working interest of the leases covering this prospect.

The Petrophysical evaluation of the logging data has indicated the presence of a total net hydrocarbon filled sand interval of 180 feet. This petrophysical evaluation has been undertaken using traditional parameters for production performance in the play trend. Dependent upon porosity and water saturation cut-offs applied, there is potential for an additional 150 feet of net pay in the well.

Pre-drill prospective resource estimates for the Lightning prospect, as first announced on 4 December 2018, assumed a P50 net hydrocarbon bearing reservoir thickness of 31 feet with a P10 net hydrocarbon bearing reservoir thickness of 75 feet. Estimates of reserves will take some months to calculate and will be further refined with production data. The company will update the market as soon as these numbers are available.

Further evidence supporting the presence of movable hydrocarbons occurred during drilling where strong gas shows, including C5+, were recovered at the surface. Indications during drilling showed several sand intervals have the potential for liquids yields significantly higher than the pre-drill estimates. Fluid composition and liquids yield will be determined during well clean-up operations and ultimately production.

The Operator has run a 5½” production liner in the well and is commencing preparations for completion and subsequent tie back to a nearby sales pipeline. The drilling rig will be released and mobilized to the drilling location for the next prospect in the Gulf Coast program with Hilcorp, Don Julio 2, in the coming week. A completion rig will be used to install production equipment and bring the well into operation.

The development plan is to deliver production into one of two nearby multi-phase sales pipelines via a 4” export line to be laid from the well. The company expects these operations to take approximately 45 days with the first production from the well by the end of March 2019.

The company’s Managing Director, Matthew Allen has said that the result of the Lightning well is an outstanding outcome for the company’s shareholders. The well has delivered significantly in excess of the management’s pre-drill estimates which will materially increase the company’s reserves base and rapidly diversify the management revenue base.

Now let us quickly have a look at the company’s stock performance and the return it has posted over the last few months. The stock is currently trading at a price of $0.060 and is trading up by 42.857% during the day’s trade, with a market capitalization of $78.76 million. The counter opened the day at $0.07, reached a day’s high of $ 0.072 & touched an Intraday low of $0.059. The stock has yielded a Year Till Date returns of 2.44% and posted returns of -33.86%, -17.65% & 5% over the past six months, three months & one-month period respectively. It had a 52-week high price of $0.083 and touched 52 weeks low of $0.035, with an average volume of 2,096,739 approximately.

Disclaimer

This website is a service of Kalkine Media Pty. Ltd. A.C.N. 629 651 672. The website has been prepared for informational purposes only and is not intended to be used as a complete source of information on any particular company. Kalkine Media does not in any way endorse or recommend individuals, products or services that may be discussed on this site. Our publications are NOT a solicitation or recommendation to buy, sell or hold. We are neither licensed nor qualified to provide investment advice.