Ascent pleases with well update

published 10 July 2012

European oil and gas company Ascent Resources has been lifted by better-than-expected results at the PEN-105A gas well in the Penszlek field of north-eastern Hungary.

The firm recently completed operations to add additional perforations to the well, which is a sidetrack of the PEN-105 well and was originally completed in April 2012 with seven metres of perforations. The asset is owned by PetroHungaria, in which Ascent sash a 48.8% stake.

The additional perforations were made in two stages with a flow test for each stage. The results indicate that the acid stimulation which had originally been considered is not necessary given the strong well response to the newly-perforated sections.

Subscribe to MoneyWeek

Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE

Get 6 issues free

https://cdn.mos.cms.futurecdn.net/flexiimages/mw70aro6gl1676370748.jpg

Sign up to Money Morning

Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter

The deeper perforated intervals are below the previously defined gas-water contact and this will result in an increase of the gas reserves that can be produced from the PEN-105A well.

Production is currently limited to around two million square cubic feet per day due to constraints at the third-party facility into which both the PEN-105A and PEN-101 wells produce. Discussions are on-going with the facility operator to remedy the facility bottleneck that would allow for greater production from the Penszlek wells, the firm said.

Jeremy Eng, Ascent's Managing Director commented: "The PEN-105A well result was better than expected because of improved reservoir characteristics at the PEN-105A location as compared to the original PEN-105; now the increased thickness of the proven gas bearing reservoir has further improved the overall results."