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Anglo African Oil & Gas eyes upgrade to production at Tilapia as TLP-101 well restarts

Using one of two existing wells as a water injector could vastly improve production output at Tilapia - excluding the ongoing TLP-103 well programme which promises to deliver an upgrade of its own
oil and gas operations
TLP-101 could potentially yield 400 bopd, according to estimates

Anglo African Oil & Gas PLC (LON:AAOG) has reinstated production from the TLP-101 well at the Tilapia field; meanwhile operations on the new TLP-103 well continue.

The company explained that TLP-101 had been producing around 30 barrels of oil per day before the TLP-103 programme got underway, but production had to be paused due to the proximity of the gas flare to drilling apparatus.

TLP-101 has now been restarted, following the relocation of the flare, and over an initial two-week test phase it has flowed at a rate of 55 bopd (barrels of oil per day).

READ: Anglo African strikes more oil at Tilapia

Technical study during the downtime has revealed that TLP-101 and TLP-102 are ‘in connection’ and, supported by expert advice, the company had decided that it will enhance the TLP-101 performance by using TLP-102 as a water injector well.

It is, at this stage, estimated that by using such an enhanced recovery method could see TLP-101 output rise to around 400 bopd.

The company is now working on the cost estimates for the potential work programme and will assess the proposals commercial feasibility.

“While the recent focus of news from the company has rightly been on TLP-103C and the very successful drilling campaign, we have also been working methodically on the other two wells at the Tilapia site,” said David Sefton, AAOG executive chairman.

“TLP-101 being taken offline for a while provided a perfect opportunity to run tests that would not ordinarily have been possible. 

“Following these tests, TLP-101 has been successfully brought back online and at rates of production which are materially more than those at which that well has produced over recent years.”

TLP-103’s ongoing programme continues to hit oil

In late December, AAOG reported results from the ongoing TLP-103 programme with the Mengo horizon encountered on Christmas Eve.

It observed oil and gas shows throughout the entire 50 metres of sandstone beds, and, actual hydrocarbon pay thickness will be confirmed by wireline logging data and pressure points.

Additionally, three new potential pay zones have been encountered. These zones, formed by sandstones, showed a positive log response and hydrocarbon shows. They will be investigated with MDT logging to test their potential. These new zones were not encountered in TLP-101.

The plan now is to complete the current well section and then pause drilling in order to undertake a full suite of Schlumberger wireline logging. Following wireline logging, Anglo will continue drilling towards the deeper Djeno horizon, which is known to be a 'prolific producer' in neighbouring fields.

“This success in the Mengo is significant,” David Sefton said at the time.

“The Mengo has, depending on the exact characteristics of the reservoir following logging and eventual testing, the potential to provide material increases in production, and cash flow, to the company.”

“A genuine surprise, albeit a very welcome one, has been to encounter potential pay zones above the Mengo, in layers where this was thought unlikely due to previous well data. These results indicate a well-developed on-shore/offshore hydrocarbon system underlying Tilapia and validate our confidence in this asset.”

Broker hails latest good news

FinnCap described it as “another fillip of good news” and highlighted that the TLP-101 cashflow supports the company as it continues to look for alternative financing.

The broker also highlighted upcoming potential catalysts, analyst Jonathan Wright said: “Next up, likely in short order, will be the results of the wireline logging on the various zones encountered so far with TLP-103C.

“The market will be looking for confirmation of better-than-expected net pay in the Mengo as well as more detail on the reservoir quality for that and the newly encountered zones.”

--Update to include finnCap comments--

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