Brookside Energy jumps out of the blocks as early production rates at Jewell exceed pre-drill estimates

  • Sep 24, 2021
  • Proactive Investors

Brookside Energy Ltd (ASX:BRK) jumped by 14.4% at the opening to A$0.032 after oil & gas production exceeded pre-drill estimates just weeks after bringing its pioneer Jewell Well in the US online.

The oil & gas asset is now generating 1,238 barrels of oil equivalent a day, a statistic managing director David Prentice believes is a good omen for future production.

With only 22% of the well’s stimulation fluid recovered to date, Jewell’s oil and liquid-rich gas production is expected to increase steadily in the coming weeks.

The well forms part of the ASX-lister’s five-year, 20-plus well development strategy, which centres on bringing oil and gas assets online within its ‘core of the core’ landholding in Oklahoma’s Anadarko Basin.

Commenting on Jewell’s early flow-back production rates, Prentice said it was a good sign of things to come.

“Once again we are delighted to report on the early performance of the Jewell Well.

“These are extremely encouraging results, and to be exceeding our pre-drill estimated flow rates at this early stage of the flow-back process is a strong indicator of the future economic performance of our maiden operated well in the SWISH AOI.

“We are looking forward to bringing further updates on the well's performance as we move forward and achieve a peak rate and ultimately [the] IP30 and IP90 rates, which are important milestones in terms of our key metrics or rate of return and time to payout.”

Just one week ago, Brookside’s cornerstone oil and gas asset entered production, kicking off oil and gas sales in what management heralded as “a major milestone”.

At the time, the well’s oil and gas flow rates were already accelerating towards the company’s base case volume estimates, which it calculated prior to drilling,

To date, the Jewell Well has produced approximately 14,800 barrels of oil and 29,500 Mcf of liquids-rich gas.

The oil is trucked to a nearby pipeline terminal, while the gas travels through a pipeline to an LP gas processing plant to stimulate sales.

Brookside will continue to report on Jewell’s performance as it hits the peak production rate, as well as two other initial production metrics, known as IP30 and IP90.

Essentially, this measures the well’s average daily production rate after 30 and 90 days.

With production at Jewell well underway, the Brookside team has turned its attention to the second well in its grand plan: the Rangers oil & gas asset.

Construction on some of Rangers’ key components is now underway, while a recent $9 million placement will fund the well’s development.

A fortnight ago, Brookside also secured a drill rig to tap into the oil and gas asset in the near future.

The well sits within the Rangers drill spacing unit — one of three exploration packages within Brookside’s SWISH Area of Interest (AOI).

SWISH sits at the heart of the SCOOP Play, one of two Anadarko Basin oil and gas plays where the company’s interest lies.

Prentice said last week: “Our industry operates around the clock, and we have little time to reflect on this success as we move forward with the Rangers Well, the next well in our potential five-year, 20-plus well development drilling program.

“We look forward to bringing everyone news on that front and importantly the ongoing production performance of the Jewell Well over the coming weeks.”