Oilman Jim's Letter - 28 May 2024

Valeura Energy (VLE.TO VLERF) announced the successful completion of an infill drilling campaign at Nong Yao A and the start of development drilling on the Nong Yao C extension, both part of the Nong Yao oil field, offshore Gulf of Thailand. Per Sean Guest, President and CEO, the results further illustrate the potential of Valeura’s assets to add volumes through ongoing infill drilling. The start of drilling operations at the brand new Nong Yao C infrastructure is said to mark a significant milestone for the company. This will be the first new development for Valeura in Thailand and is expected to serve as a substantial source of production growth in the second half of this year. The drilling campaign is anticipated to take approximately four months and will be comprised of up to nine gross wells, being six producer wells and up to three water injectors. The company is anticipating first oil from the Nong Yao C development in Q3 2024, and thereafter is targeting aggregate peak oil production rates from the expanded Nong Yao field of 11,000 barrels per day, approximately a 50% increase over the 7,307 barrels per day reported for Q1 2024.

Chariot (CHAR.L OIGLF) announced a gas discovery at its Moroccan onshore licence. The OBA-1 well on the Dartois prospect, the second of a two well drilling campaign in the Loukos onshore licence, was drilled to a final measured depth of 901m through the target reservoirs. Following evaluation of the well data, preliminary interpretation confirms the presence of reservoirs over an interval of approximately 200m gross thickness, within which an approximate 70m gross interval of primary interest has been identified containing elevated resistivities coincident with elevated mud gas readings, indicating potential gas pays with no water-bearing reservoirs identified. Further post-drill analysis will be conducted in preparation for well flow testing which will determine the well productivity and the gas resource potential of the discovery. The well will now be suspended to allow future rigless flow testing operations and potential use as a producer well. Next up is the offshore drilling campaign planned for Q3 2024 on the Anchois gas field with new partners Energean, where they are looking to increase the development to over 1 trillion cubic feet.

Blue Star Helium (BNL.AX BSNLF) announced that the State 16 SWSE 3054 development well at its Galactica helium project in Las Animas County, Colorado, has been successfully drilled to its final total depth. The well encountered the Lyons formation at a depth of 1,111.5 feet and was completed at its planned TD at the base of the upper sand of the Lyons formation at 1,211 feet. No water was encountered during drilling. Wireline logs confirmed this and show approximately 96 feet of high-quality sands in the upper Lyons production section to be gas saturated. The well flowed naturally during drilling and has been cleaning-up since drilling operations were completed. The company is now to commence pressure and flow testing, including a pressure gradient test, followed by sampling and a pressure build-up test over a five-day period. Upon successful final testing and analysis, the well will be completed for tie-in to production facilities. Commercial discussions with interested buyers have been ongoing since Q4 2023.

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