Prominence Energy NL; AGM Highlights with Bowsprit Development Plan in Focus

Oil & gas (O&G) exploration and development company, Sun Resources NL (ASX: SUR) changed its name to Prominence Energy NL. The change in the company name was approved by the shareholders at the Annual General Meeting held on 29 November 2019. Accordingly, the company’s ASX Code changed to ASX: PRM. This is the latest step in the rejuvenation of the company, which over the last two years has had a new Board and Management Team, a new project and new corporate advisory group (GTT Ventures) to reposition the company for growth.

Results of 2019 Annual General Meeting

Following resolutions were cleared during the 2019 annual general meeting of the company.

• Resolution 1 - Remuneration Report that forms part of the Directors’ Report for the financial year ended 30 June 2019
• Resolution 2 - Change of Company Name - Approval secured to change the company name.
• Resolution 3 – Re-election of Director – Mr William Bloking
• Resolution 4 – Re-election of Director – Mr Patric Glovac
• Resolution 5 – Approval for the issue of approximately 153.75 million unlisted options (at an exercise price of AUD 0.004 per share and with an expiry date of 31 December 2020) as free attaching options on a one for two shares subscribed basis
• Resolution 6 – Approval for the issue of equity securities up to 10% of the issued capital of SUR

On 29 November 2019, Prominence Energy, a conventional oil-focused explorer, released Managing Director and CEO Alex Parks’ presentation at the 2019 Annual General Meeting of the company. At the AGM, Mr Parks discussed the company’s key asset- Bowsprit Oil Project, in Breton Sound, Louisiana in the United States, along with its growth plan.

Bowsprit Oil Project

• PRM holds 100 per cent working interest in the project, which is on lease areas spread over 1,154 acres.
• The project is in inland shallow waters offshore Louisiana, approximately 70 kilometres southeast of New Orleans.
• The lease area contains several historical fields, including an undeveloped oil field
• Proven oil in reservoir that has flowed 75,000 barrels
• Minimum economic pool size estimated to be 0.5 million barrels
• The first well at the project is estimated to cost USD 3.6 million

Do Read: Sun Resources’ Bowsprit Oil Project and its Redevelopment Potential

To drill the first well at the Bowsprit Oil Project, the company has secured all the necessary permits.

• State Permit 1: Louisiana Office of Coastal Management
• State Permit 2: St. Bernard Parish Drilling Permit
• Federal Permit – U.S. Army Corps of Engineers – Granted

Do Read: Sun Resources Secures Final Permit to Drill Bowsprit-1 Well in Inland Waters of Louisiana

Bowsprit Development Plan

PRM plans to drill first well - Bowsprit-1 Well - at the project, targeting three zones- T1, T2 and T3.

• T1 (Upper Miocene Proven Oil)
  • Initial horizontal crestal well would be tied back to Yuma/Cox Production facility for early cash flow.
  • IP is approximately 1,000 barrels per day of oil, EUR is approximately 100-750k barrels
• T2 (Middle Miocene Prospective Oil)
  • If/once proven to hold mobile hydrocarbons, one-two horizontal wells would be drilled for the production of up-dip oil through a dedicated new/second-hand production facility at Bowsprit.
  • Thicker sand IP – approx. 5,000 barrels per day oil oil, EUR ~5 million barrels. Gas exported through line to Yuma/Cox. Oil Barged to coastal refinery.
• T3 (Middle Miocene Prospective Gas)
  • Modest Gas produced through the Bowsprit facility +1 well.

Single Well Tie Back Options for Bowsprit Oil Project - Mr Parks also highlighted that there are four potential local facilities that could be tied back to, with tie back to cost approx. USD 0.5-1 million.

The appraisal well is anticipated to be produced through a tie back pipeline to a nearby facility. The cost involved would be very low (approximately AUD 0.75 million to Yuma) for early cash flow or if there are no movable hydrocarbons in lower sands.

Growth Plan

Prominence Energy plans to drill a horizontal well in the first quarter of 2020, subject to funding/farm-out. The company’s primary focus is on bringing the project to production as soon as possible, with ongoing negotiations for farm-out and funding support for drilling.

The company intends to drill, and flow test the first well to prove commercial rates, in addition to proving that the whole structure contains moveable oil. Moreover, PRM plans to produce first oil with 2-4 further development wells.

After bringing the Bowsprit Oil Project to production, the company plans to expand by identifying and securing follow up projects 2/3/4 in area.

• PRM plans for data purchase and detailed work up of opportunities, development and appraisal concepts
• Nominate and obtain acreage
• Work towards detailed planning and desk top work, FEED, among others
• Fund development planning from cash flow from the project

In the long run, the company intends to identify new exploration and use new, cable-less 3D seismic for identifying deeper fields. Moreover, Prominence Energy plans to use quantitative seismic interpretation techniques on areas that were never covered by 3D seismic (high resolution).

More on Growth Plans can be read here

The stock of Prominence Energy last traded at AUD 0.001 on 13 December 2019, with a market cap of AUD 1.32 million and approx. 1.32 billion outstanding shares.

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