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Mosman Oil and Gas reports $2m of resources at Welch project
Mosman Oil & Gas announced on Wednesday that it has identified proved reserves of 234,000 gross barrels of oil with a value of roughly $2m at its Welch Permian Basin project in Texas.
The report from Moyes & Co said proved reserves included undeveloped resources of 102,000 barrels with a value of $0.6m for a single proposed horizontal oil well, which the company says "represents an encouraging potential development opportunity".
The figures stem from a reserves report put together by , a team with significant operational and technical experience in the oil and gas industry.
John Barr, chairman of Mosman Oil and Gas, said: "We are pleased to achieve this milestone of Proved Reserves that underpins our view that Welch was a sound acquisition, at the right time, and where we have added value in less than 12 months."
While only one horizontal well has been included in the reserves report at Welch, the company believes that three further horizontal wells will be possible.
A decision regarding the planning for horizontal wells will follow the completion of a number of board objectives, including an economic evaluation, permitting and a development plan.
"Importantly, the proved reserves identified at Welch should provide a basis for being able to obtain bank debt to assist in funding further production growth. Looking forward at Welch, we continue to evaluate horizontal wells with the objective of having a development plan to put before the board later in 2018," said Barr.
As of 1005 BST, Mosman Oil and Gas' shares were up 6.90% at 0.77p.