Rose Petroleum PLC (LON:ROSE) told investors that the design for an upcoming seismic survey in the Paradox basin in Utah, has now been completed and the operations are expected to start within a matter of days.
It sees a reduction in the scale of the survey, which will keep costs down.
In a stock market statement, the company highlighted that the shoot has now been focused on an area of 40 square miles, within the 61 square miles permitted area, and it retains the same coverage over the Rose acreage, but, has cut out extended areas which weren’t part of Rose's acreage.
The company explained that the survey should allow it to predict areas of open natural fractures in the Paradox basin.
It added: “The Paradox Basin is a natural fracture driven basin, and drilling will target ‘fracture swarms’ which allow commercial flow rates.”
In reaction, Rose Petroleum shares gained over 7%, or 0.01p to 0.10p in lat afternoon trading.
Hydraulic fracturing is not usually required in such areas, according to Rose, which also said that 3D seismic surveying is an essential part of identifying the ‘fracture swarms’ and therefore an “essential path to unlocking the value of the Paradox acreage”.
"I am delighted with the progress we have made on the optimisation of the designs and the potential savings created by the improvements,” said Matthew Idiens, Rose chief executive.
“Reducing the shoot area to 40 square miles whilst retaining the same coverage of our acreage has enabled a significant reduction in costs without affecting the quality of the data.
“Surveying work is expected to commence within days which will keep us on track for completion of the shoot by year end.”
Idiens added: "We look forward to keeping the market updated in respect of both the progress on the ground and in respect of our future funding options, which are still progressing and we are confident of a positive outcome, hence the commencement of the surveying work."
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