Wednesday’s News! Rockrose Energy development plans

Rockrose Energy (RRE.L, Market Cap £224m, 1715p, 9.2% of JIC Portfolio and 9.2% of JIC Top 10)

Conclusion: In the absence of other news it is useful for Rockrose to remind investors of the potential within its existing assets to increase production and or extend the life of fields. Hopefully, this will prove a fillip to the share price which continues to look, in my opinion, cheap. An operational update in January should demonstrate how much cash it has generated and how strong its balance sheet is. It may also outline its dividend plans for 2020. I have it as Low Risk (strong balance sheet etc) and High Return (trading at less than cash on the balance sheet). Happy Holder!

Rockrose has published its development plans for the coming year. the Noble Houston Colbert jack-up drilling rig is preparing to drill the first of two planned infill development wells on West Brae. RockRose is the operator of West Brae, in which it has a 40% working interest.

“Designated WPGZ and WPOZ, these wells are designed to access 2P reserves of over 8 MMbbl (gross) and to support Brae Complex output by up to 6,000 bopd (gross). WPGZ is expected to come onstream before the end of the first quarter of 2020 while first oil from WPOZ is anticipated in the second quarter of 2020.”

In addition, it says that it is set to participate in a total of seven wells before the end of 2020. “These will help drive production growth over the next two years and further investment in growth projects is anticipated in 2021 and 2022.”

“A four-well drilling campaign is scheduled to commence at the Shell-operated Arran gas/condensate field development in the first quarter of 2020. RockRose has a 30.4% working interest in Arran, which remains on schedule for first gas in early 2021. In addition, the first of two infill wells planned as part of the Blake life extension project will be drilled in the second half of 2020. RockRose has a 30.8% working interest in Blake.”

RockRose plans to issue a further operational update in January.

Commenting, Andrew Austin, Rockrose, Executive Chairman, said:
“The spudding of WPGZ will represent just the start of a sustained period of drilling activity for RockRose. This will add significant production and value to the Company, as we continue to deliver on our strategy; growing production and generating surplus cash flow that can be reinvested to maximise returns for shareholders”.

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