Otto Energy Completes Lightning Field Commissioning

THE BOWSER: Otto Energy (ASX: OEL) reported that production from the company’s Green #1 well on the Lightning field in Matagorda County Texas, USA has reached a steady production state as final facilities commissioning has been completed.

Otto Energy has a 37.5 per cent working interest (28.5% Net Revenue Interest) in the leases covering this field.

The company said it has put the Green #1 well through a series of tests to determine deliverability and that it is currently being operated on a 13/64th of an inch choke setting.

The well is delivering approximately 10 million standard cubic feet per day (MMscf/day) with more than 280 barrels per day (bbls/day) of associated condensate.

Otto indicated that final commissioning of the gas plant and associated facilities at the Lightning development have now been completed and production has reached a steady state.

The hot tap into the sales pipeline was completed in May and the well was opened to the sales line.

The company expects the Lightning well will contribute towards revenue through the commissioning months in May and June 2019 with the first full month of contribution to occur in July 2019.

Field Development Field evaluation will be ongoing with flowing material balance being used over the coming months to determine well deliverability and the overall reservoir size to optimize future development wells.

At this stage, the joint venture is planning for a second well to be drilled in January 2020 or earlier dependent upon the results of this analysis.

Further wells will likely be required to fully develop the very large size of the Lightning field.

“The Lightning field development represents the first in what Otto anticipates will be a strong pipeline of new development opportunities to come out of the current busy exploration drilling campaign that has been underway since mid-2018,” Otto Energy managing director Matthew Allen said in the company’s announcement to the Australian Securities Exchange.

“Diversifying Otto’s production base and delivering upon our strategic goal of 5,000 barrels of oil equivalent per day by the end of 2020 has been a key focus for Otto over the past three years since entering the USA and making our first discovery at South Marsh Island 71.

“Otto is very pleased to be making significant progress towards the achievement of this goal.

“Otto would like to congratulate the field operator and all the team involved at Hilcorp Energy on the successful commissioning of the Lighting facilities and achieving a steady production state.

“The development of deep, geo-pressured gas/condensate fields requires the skills and experience of an operator of Hilcorp’s calibre.

“Otto looks forward to working with Hilcorp to further the Lightning development in coming months with the drilling of additional wells being planned in the early stages of the field life to optimise ultimate recoveries.”