NEWS BULLETIN

June 27, 2019 --- Vol. 25, No.25June 2019

Oil Search exercises Pikka, Horseshoe option

Today, June 27, Oil Search exercised its option with Armstrong Energy and GMT Exploration to double its working interest in Pikka and Horseshoe area leases on Alaska's North Slope.

Per a statement issued by the company, for the sum of $450 million, Oil Search doubled it 25.5% interest in the Pikka unit and 37.5% in the Horseshoe block (and other exploration leases) to 51 % and 75%, respectively, with Repsol holding the remaining working interest in the leases.

The initial Alaska purchase was made in February 2018 based on an estimated gross resource of approximately 500 million barrels in the Nanushuk oil play and neighboring reservoirs associated with the Pikka unit. Additional upside potential has been identified in the continuation of the Nanushuk play into the Horseshoe block to the south of the Pikka unit.

Oil Search's joint venture partners, Armstrong and Repsol, estimated that ultimate recoverable volumes could be more than 1 billion barrels.

Per an earlier news bulletin today, Oil Search said the Pikka unit project is expected to partly go online in 2022, versus the company's initial plan of late 2023, through a 30,000 barrels-of-oil per day early production system, utilizing existing capacity in the processing facilities of an adjacent operator, followed by the development of dedicated facilities to manage production of approximately 120,000 bpd (gross), allowing full field production to commence in 2024.

- KAY CASHMAN

See story in July 7 issue of Petroleum News, available online July 5 at www.PetroleumNews.com

For information on PN's news bulletin service, call 907-522-9469. PO Box 231651, Anchorage, AK 99523 - 1651


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