- Otto Energy (OEL) has reported a boosted output from its 30-per-cent-owned Oyster Bay South and Mosquito Bay West wells in the Gulf of Mexico
- The wells have a combined output of 2329 barrels of oil equivalent per day, up 33 per cent from the average daily production rate in the June quarter
- Additionally, Otto expects the Eaves and Green Canyon 21 wells to come into production sometime this month
- Executive Chair Mike Utsler says Otto expects a “substantial” uplift in net production and cashflow realisations as it enters the last quarter of the year
- OEL shares are trading grey at 1.3 cents at 3:31 pm AEST
Otto Energy (OEL) has released an update on the exploration wells in which it has working interests within the Gulf of Mexico.
The Oyster Bay South well is in the early stages of production and is producing 807 barrels per day (bbl/d) of oil after originally being expected to flow at an initial rate of 150 bbl/d.
It’s producing 4.6 million standard cubic feet per day (MMscf/d) of gas at a flowing tubing pressure (FTP) of 3614 pounds per square inch (psi).
Otto Energy holds a 30 per cent working interest in the Oyster Bay South and covers a portion of the costs of the well, as announced in March this year.
At the same time, the company began participating in the Mosquito Bay West well, in which it holds a 30 per cent interest.
The energy stock said the Mosquito Bay West Point Au Fer LLC 1 well was producing strongly from the Disc 12-2 sand at a rate of 205 bbl/d of oil and 3.3 Mscf/d
The well is also producing 72 bbl/d water at a 3544 psi FTP.
Otto Energy noted the combined output for Oyster Bay South and Mosquito Bay West equalled 2329 barrels of oil equivalent per day (boe/d), equating to roughly 700 boe/d Otto working interest with 43 per cent liquids.
The company said this represented a 33 per cent increase in its working interest wells’ average daily production rate in the June quarter.
Additionally, Otto expects two wells in which it holds minor interests to come into production sometime this month.
Its 10.3-per-cent-owned Eaves well is awaiting gas meter connection, but first production is still targeted for this month.
At the Green Canyon 21 (GC 21) well, the drill rig has cut and removed the 4.5-inch production tubing associated with the MP Sand. Cement has been pumped and set in the well. After this, GC 21 will be perforated and a frac pack run in before flow back to sales.
Otto holds a 16.67 per cent working interest in this well, which is expected to produce this month.
Lastly, the 50-per-cent-owned SM 71 F2 well has been recompleted in the J1 sand.
The well is currently producing 171 bbl/d of oil and 83 Mcf/d of gas, and until the fluids clean up, the well will be held at a rate of roughly 200 bbl/d.
“The results from these growth activities to date validate both our commercial strategy and the quality of opportunities afforded by our strategic relationships over the past 12 months,” Otto Executive Chair Mike Utsler said.
“With the addition of anticipated outcomes from the GC 21 recompletion and the final tie-in of the Eaves well, we are expecting a substantial uplift in net production and cashflow realisations as we enter the final quarter of CY2022.”
OEL shares were trading grey at 1.3 cents at 3:31 pm AEST.