NG Energy International (TSXV: GASX) this morning had a positive update for investors on the status of its Istanbul-1 well along with its GTX facility for its Maria Conchita gas field. The updates push the company one step closer to production.
The company is currently prepping to conduct the re-entry of the Istanbul-1 well, enabling the company to install equipment for the de-watering of the well. The process will remove water that is currently downhole from when the well was originally drilled.
The re-entry process is set to consist of a ten day program, which is currently in the final steps of planning, with the re-entry slated to be completed and the repairs conducted by the end of the month. Following the removal of the water, the company will acquire a surface gas volumetric response, which will allow for an estimate to be conducted on the real capacity of the well for gas production without a liquid load.
Currently the company is expecting between 3 and 5 MMSCFPD of production from Istanbul-1, in addition to the 16 MMSCFPD expected from Aruchara-1, setting the company off on a strong production start later this year.
Gas produced at Istanbul-1 is initially to be sold via truck, with conversations currently advancing discussions with end buyers of natural gas. Transport via truck will begin following the assembly of the GTX production facilities, with production facilities slated to be completed by the end of November.
In terms of the pipeline, the company this morning revealed it has met an agreement with Transportadora de Gas Inernacional (TGI) related to the tie-in of the Maria Conchita pipeline. Gas produced at Aruchara-1 as a result will be sold via the pipeline, along with subsequent wells. The remaining lines are to be installed and tied into the main TGI line by the end of the year.
NG Energy last traded at $1.92 on the TSX Venture.
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