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Igas said it would move to the execution phase of its waterflood project at its existing producing field at Scampton in the East Midlands after it received final planning approvals.
The Scampton Waterflood Project would convert an existing well to a water injector to increase oil sweep and field estimated ultimate recovery by implementing secondary recovery (water-flood) in the western portion of the Scampton North field, the company said.
The recent estimate put the incremental 2P (Probable Undeveloped) reserves for this project at 239m, and 'our estimated mid-case project economics have an IRR of over 40% and a NPV of £2.5 million,' the company added.
The total cost of the project was about £2.0m, the majority of which would be incurred in the next 12 months, with resultant incremental production of about 100 barrels a day.
'We have a number of attractive projects across the portfolio which continue to mature as we seek to maximise returns on our existing operations and infrastructure, and in this case are pleased to be moving forward with a low-risk opportunity with an estimated IRR of over 40%,' said Stephen Bowler, Chief Executive.
'Alongside these production uplift opportunities, we also continue to work up additional appraisal and exploration opportunities to access new fields in our conventional portfolio.' 'Projects, particularly on existing sites, offer good returns at these oil prices with reduced risk and minimal incremental operating costs and we look forward to announcing future projects in due course.'
At 10:03am: (LON:IGAS) Igas Energy PLC share price was +0.8p at 58.9p