Park Place Energy, Inc. (OTCQB: PKPL), a Texas-based gas and oil exploration company focused on running international development and exploration projects, anticipates significant growth in terms of cash flow and share prices once it completes the acquisition of three oil and gas companies in Turkey next month. The company, which already has an established presence and offices in the Balkan region via its gas exploration in northeast Bulgaria, entered a purchase agreement with Tiway Oil B.V. in December of last year for the acquisition of three Tiway subsidiaries controlling three oil and gas explorations in Turkey – one offshore and two onshore, for $2.1 million. A $500,000 deposit toward the purchase was already made when the deal was initiated, and plans are to complete the transaction by the end of the year, once all regulatory approvals are received from the Turkish authorities.
The three producing areas that will be purchased from Tiway under the agreement have significant potential, in particular the South Akcakoca Sub-Basin (SASB) offshore gas field. Production from the three assets has averaged 417 barrels of oil equivalent per day (POE/D) in the first nine months of the year. Park Place intends to begin programs to maximize production as soon as the transaction is completed, most likely starting in January of next year.
The main focus will be the SASB gas field in the Black Sea, which is described as having substantial untapped potential, with a total of four platforms, 22 wells of which 10 are fully functional, and an onshore gas processing plant. Tiway has a 36.75% non-operated working interest in SASB. Since its discovery in 2004, the field has produced an estimated 37 billion cubic feet of gas and has yielded roughly $277 million in gross proceeds. Park Place has identified four undeveloped discoveries with the potential of producing up to 60 billion cubic feet of gas in the near future. The company expects the SASB field to generate initial revenue of more than $200 million by the end of 2018, once it launches its production enhancement program consisting of the drilling of four additional wells, construction of a gas lift and re-drilling of some of the existing wells.
The two onshore assets – the Cendere oil field and the Bakuk gas field – are also expected to generate significant revenue and to consolidated Park Place’s presence in the region. Although in operation since the 1990s, Cendere is likely to continue production for another 10 years or more. The field currently has 16 wells producing gross 600 barrels per day, with 110 barrels net to Tiway. Cendere has produced more than 19 million barrels from the 45 million estimated initially. Park Place intends to increase the field’s production further through additional infill well opportunities, possibly extending the field laterally and through low cost perforation in the upper pay zones. The Bakuk gas field, located near the border with Syria, has only one well in operation, averaging roughly 48 Mcf/D during the first six months of the year. There is an estimated 5.8 Bscf gas still in place, according to Park Place figures.
In addition to the Turkish assets, Park Place holds the rights to a gas field in Bulgaria. The Vranino 1-11 Block, located in the northeast portion of the country, is currently not in operation, as the regulatory approvals issued by the Bulgarian government were disputed by local NGOs. Until the situation is resolved, Park Place cannot commence operations to extract gas from coal seams in the area. The company is planning on drilling up to five wells using the latest and safest gas extraction techniques not involving underground coal gasification or hydraulic fracking, which was banned in Bulgaria in 2012. It is believed that the Vranino block may contain more than one trillion cubic feet of recoverable gas and that successful extraction, in addition to the field’s close proximity to a major gas pipeline, can eventually lead to lower gas prices for the entire region.
For more information, visit www.parkplaceenergy.com
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