Ascent Resources plc is an independent, multi-project, European focussed oil and gas exploration and production company. Its portfolio is balanced providing access to low-risk development and revenue generating production projects, alongside exploration projects with the potential for higher returns. An experienced management team, implementing a defined development programme on primarily onshore projects, provides Ascent with a solid platform to grow and generate value for stakeholders. Licences are held in Hungary, Slovenia, Italy, Switzerland and The Netherlands.
Ascent Resources to commence production to sales from PEN-101 after successful tests
Ascent Resources (AIM: AST) has tested and completed the PEN-101 well in the Peneszlek area of the Nyrsieg exploration permits in eastern Hungary, which will commence production to sales immediately following the departure of the rig during the week of 15 March.
Initial production rates achieved during preliminary testing exceeded 1.0 MMscfd (million standard cubic feet per day), and productivity is expected to be improved in the coming days by the use of small scale acid stimulation, similar to that previously used with positive results on the PEN-105 well.
The rig will then move to the PEN-104 location to continue the testing of the PEN-104AA sidetrack and, subsequently will continue drilling the PEN-106 well, which targets a structure that is similar to that proven by the PEN-105 well.
Leni Gas & Oil (AIM: LGO) has recently announced the relinquishment of its interest in the project, which has been distributed among the remaining project partners in proportion to their prior interest in the project at no additional cost. Ascent currently holds a 48.776% project interest, and a revenue interest and cost share of 51.654% and 53.381% respectively in wells PEN-101 and PEN-106.
“The recommencement of production in the coming days and the increased share of revenue that Ascent and its partners now stand to gain following LGO's decision to exit the project is an excellent outcome for Ascent...these types of projects benefit from low development and production costs, and with deregulated gas prices, provide a relatively high return on investment,” said managing director of Ascent Jeremy Eng.
Broker Astaire Securities said that progress has been in line with expectations as while the flow rates achieved from PEN-101 were lower than those in PEN-105, the well still is a commercial producer.
“Peneszlek will drive revenue growth through our forecast period, and we expect further updates to provide important short term newsflow. Ascent’s increased working interest is beneficial, and it is also reassuring to hear that the Fontana-1 well onshore Italy continues to drill ahead, with an update expected shortly,” said the note.
The company said it will soon provide an update on the re-drill of the Fontana-1 well in Italy, which is currently drilling ahead at a depth of over 400 metres.
Shares in Ascent resources rose nearly 5% on the update.
