Infrastrata PLC INFA Exploration Update

  Infrastrata PLC (INFA) - Exploration Update

RNS Number : 9405R
Infrastrata PLC
26 November 2012




                                      

                                      

                                 



26 November 2012    
For Immediate Release

                                      

                                      

                               InfraStrata plc

                       ("InfraStrata" or the "Company")

                                      

                                      

                              Exploration Update

                                      

InfraStrata plc  (AIM:INFA), the  independent  petroleum exploration  and  gas 
storage  company,  is  pleased  to  provide  an  update  on  its   exploration 
activities. The Company is also  separately releasing today its final  results 
for the year ended 31July 2012.



The past six months have seen significant progress in both its project areas.



Larne-Lough Neagh Basin, Northern Ireland (Operator, 46% net interest)



The PL1/10 licence was awarded to InfraStrata in March 2011 and covers an area
of 663 square  kilometres. A  second seismic  survey completed  in June  2012, 
increased the total new 2D data acquired for the Company by Tesla  Exploration 
International Limited to 400 kilometres. Processing of the data was  completed 
by Fugro Seismic Imaging Limited in early October 2012. Interpretation of  the 
data by Merlin Energy Resources Limited for the InfraStrata led joint  venture 
has resulted  in the  mapping of  more  than twenty  leads within  this  large 
licence area.



The licence covers the central part of the Larne-Lough Neagh Basin. There  has 
been a limited amount of drilling in the Larne-Lough Neagh Basin over the past
40 years; largely for coal exploration and geothermal feasibility. These wells
did however confirm  the development  of good sandstone  reservoirs and  seals 
within the thick Permo-Triassic sedimentary section, similar to those found in
the prolific East Irish Sea Basin. Oil-prone source rocks have been identified
on the margins of  the Basin within the  Carboniferous section, and  gas-prone 
coals have also been mined to the  west in the Coalisland area, and along  the 
North Antrim coast. The basin is also  along trend from the Midland Valley  of 
Scotland where oil and gas prone rocks of Carboniferous age are well known. It
is anticipated that in the more  deeply buried areas of the Larne-Lough  Neagh 
Basin the Carboniferous will have been buried sufficiently to generate oil and
possibly also gas.



Only one petroleum  exploration well  has been drilled  previously within  the 
licence area, a  well drilled  by Shell  and Marathon  in 1971,  prior to  any 
seismic being acquired. The  basin was largely ignored  by the industry  while 
other areas in the UK were extensively explored in the 1970s and 1980s. One of
the reasons  for this  lack of  attention was  the presence  of thick  basalts 
extensively covering  the surface  of  County Antrim.  The properties  of  the 
basalts were  a significant  challenge to  the acquisition  and processing  of 
seismic data. Recent  technological advances are  opening up sub-basalt  plays 
around the world. The two seismic campaigns by InfraStrata, undertaken in 2011
and 2012, have proved successful in imaging structures below the basalt.



A trend  of  structures  within the  eastern  half  of the  licence  has  been 
high-graded. An initial "most likely"  estimate of the prospective  resources, 
by the  joint venture  partners, for  the first  of these  prospects that  the 
partners would  like to  drill  is approximately  13  million barrels  of  oil 
("mmbo") recoverable (net 6 mmbo  to InfraStrata) within the primary  Triassic 
Sherwood Sandstone target at a depth of approximately 650 metres below  ground 
level. Additional reservoir targets  will be evaluated  in deeper Permian  and 
Carboniferous sandstones. As with any  new exploration province anywhere,  the 
presence of a working petroleum basin remains the highest risk of the play and
can only be resolved by drilling. Success  with the first well would have  the 
potential to  open up  a new  play fairway  within the  licence with  multiple 
reservoir targets in multiple prospects.



The joint venture proposes  to drill its first  exploration well during  2013. 
Work has now commenced  on identifying a suitable  surface site from which  to 
drill, and engaging with local stakeholders. InfraStrata intends, if possible,
to coordinate the drilling of this well with the appraisal well planned during
2013 for the Islandmagee project, a  salt cavern gas storage venture in  which 
the Company is also a partner.



Wessex Basin, Southern England (Operator, 78% net interest)



The P1918 licence, offshore adjacent to the Dorset coast, covering an area  of 
584square kilometres, was awarded to the Company effective February 2012.



A total of seven wells have  previously been drilled within the licence  area, 
including the first UK offshore well in  1963 on Lulworth Banks. Six of  these 
wells encountered oil or gas shows and three flowed oil or gas on test. Within
and immediately adjacent to the licence area there are also a number of active
oil and gas seeps. 



The InfraStrata led joint venture has purchased approximately 3,500 kilometres
of existing 2D seismic data, and three existing 3D surveys, within or adjacent
to the licence. The  advances in technology and  higher petroleum prices  mean 
that the licensees are hopeful  of being able to  develop one of the  existing 
discoveries profitably as a base from which to appraise the full potential  of 
the area.



Over the  past two  months  this data  has  been interpreted  by  Geosolutions 
Limited on behalf of the group. The  focus has been on the offshore  extension 
of the Purbeck Prospect, an  anticline in the east of  the licence, up dip  of 
the onshore well  Southard Quarry-1, which  encountered petroleum in  Jurassic 
and Triassic reservoirs during 1989 but which was not tested. The new  mapping 
of the Purbeck Prospect shows it  covering an area of approximately 13  square 
kilometres at the primary target level, the majority within the P1918 licence.



An initial "most likely" estimate of  the prospective resources, by the  joint 
venture partners, for the primary  reservoir objective, the Triassic  Sherwood 
Sandstone, is approximately 100 billion cubic feet ("bcf") of gas  recoverable 
(net 78 bcf to  InfraStrata). An appraisal  well is now  required to test  the 
productivity of the reservoir at a  depth of approximately 2,500 metres  below 
ground level.  The  well  will  also be  designed  to  evaluate  two  Jurassic 
reservoirs where oil was encountered in the Southard Quarry-1 well.



InfraStrata is  now going  to  reprocess approximately  250 kilometres  of  2D 
seismic data  to further  define the  sub-surface target  location for  a  new 
appraisal well. It is proposed to drill the well directionally from an onshore
location to  the offshore  within  Block 98/11  of  licence P1918.  The  joint 
venture intends  to  submit a  planning  application in  Q1  2013, and  it  is 
anticipated that the first  appraisal well will  commence drilling before  the 
end of 2013, subject to consents and funding.



Further technical work will be undertaken to refine the prospect inventory  in 
both exploration projects and  the Company propose  to commission a  Competent 
Persons Report on completion of this work during the first half of 2013.



UK 27^th Seaward Licensing Round



Two licence applications, covering seven whole or part blocks, were  submitted 
with partners in 27^th Seaward Licensing Round. All the blocks applied for are
subject to  Department of  Energy and  Climate Change  ("DECC")  environmental 
assessments before any offer is made.  The Company expects the award of  these 
blocks to take place in a further tranche of licence awards by DECC during  Q2 
2013.





Commenting on  the status  of exploratory  activities, Andrew  Hindle, CEO  of 
InfraStrata plc said:



"Good progress  has been  made  in assessing  and defining  the  prospectivity 
within the  Company's  exploration  acreage.  The  coming  year  will  see  an 
increasing  focus  of  the   Company's  activities  towards  its   exploration 
portfolio. The  upside potential  of  the licences  for  the Company  is  very 
significant. Characterisation of  the primary prospects  in each licence  will 
continue as preparations are made for drilling and testing the plays, which is
expected during the second half of 2013.



In Northern Ireland  our success at  imaging good sized  structures below  the 
basalt, where the presence of good Permian and Triassic reservoirs are  known, 
is particularly exciting. In Dorset, the potential to drill an appraisal  well 
on a structure where  a well has  already encountered oil  and gas within  the 
prospect closure offers a different and equally exciting risk profile.



The funding of InfraStrata's share  of exploratory activity has  traditionally 
been through the introduction  of partners at the  assets level. A portion  of 
the first  well  in Northern  Ireland  is  already funded  under  an  existing 
farm-out agreement.  We  expect to  see  continued significant  interest  from 
industry partners in our acreage and will assess the options for securing  the 
balance of the funding for the exploration and appraisal wells in due course."





For further information please contact:



InfraStrata plc



Andrew Hindle, Chief Executive
Officer020 8332 1200

Craig Gouws, Chief Financial Officer



Financial PR - Buchanan



Richard Darby/Gabriella Clinkard
  020 7466 5000



Nominated Advisor and Broker - Arden Partners plc



Richard Day/Justine Waldisberg
 020 7614 5917







Notes to Editors:



Background on InfraStrata plc



InfraStrata is an independent petroleum  exploration and gas storage  company. 
The Company is focused on two areas in the UK, in Dorset, England and  Antrim, 
Northern Ireland.



Background on Licence PL1/10



The petroleum licence PL1/10 (Central Larne  - Lough Neagh Basin) was  awarded 
in March  2011 by  the Department  of Enterprise,  Trade and  Investment.  The 
licence covers an area of 663  square kilometres. The initial licence term  is 
five years with a decision on drilling a well required within three years.



InfraStrata is the operator  of the licence and  holds a 30% direct  interest, 
and an additional interest via a 40% shareholding in partner company Brigantes
Energy Limited.



The partners in the licence are:



InfraStrata plc  30%

Brigantes Energy Limited 40%

Cairn Energy plc  20%

Terrain Energy Limited 10%



Background on Licence P1918



The licence was awarded by the Department of Energy and Climate Change in  the 
second tranche  of  offers  for  the 26th  Seaward  Licensing  Round  with  an 
effective date  of February  2012. The  licence covers  three offshore  Blocks 
97/14, 97/15 and 98/11, covering an area of 584 square kilometres adjacent  to 
the Dorset coast close to the  giant Wytch Farm oilfield. The initial  licence 
term will be four years with a decision on drilling a well required within the
first two years.



InfraStrata is the operator  of the licence and  holds a 70% direct  interest, 
and an additional  interest via a  40% shareholding in  partner company  Corfe 
Energy Limited.



The partners in the licence are:



InfraStrata plc  70%*

Corfe Energy Limited 20%

Cairn Energy plc  10%



*Note: Subject to  a 7.5%  share of  profits, payable to  eCORP Oil  & Gas  UK 
Limited, on a 50% licence interest.



Further    information    is    available    on    the    Company's    website 
www.infrastrata.co.uk.





In accordance with the AIM Rules - Note for Mining and Oil and Gas  Companies, 
the information contained in  this announcement has  been reviewed and  signed 
off by the  Chief Executive  Officer of InfraStrata  plc Dr  Andrew Hindle,  a 
Chartered Geologist with over 25 years' experience.



                     This information is provided by RNS
           The company news service from the London Stock Exchange

END


MSCFEUFWDFESEFF -0- Nov/26/2012 07:00 GMT
 
Press spacebar to pause and continue. Press esc to stop.