Tower Resources upbeat on latest estimates at Algoa-Gamtoos

Africa-focussed oil and gas company Tower Resources announced on Monday that its subsidiary Rift Petroleum has received updated resource estimates from its 50% partner and licence operator New Age Energy Algoa.

The AIM-traded firm said the update came after New Age's interpretation of the reprocessing of additional 2D seismic data covering the Algoa-Gamtoos license, offshore South Africa.

It said the reprocessing work encompassed 4,500 line kilometres of 2D seismic data, incorporating both data already owned by the partners and also further data acquired from the Petroleum Authority of South Africa (PASA), including tie lines from Brulpadda to the Algoa-Gamtoos area, together with two post-stack merged 3D seismic surveys in the Algoa Basin.

The work was undertaken by PGS, and the focus was on creating a time and phase matched dataset covering the Gamtoos Basin and the deepwater section of the licence area.

Tower said the resulting seismic dataset showed an overall improvement in bandwidth, de-noise and imaging.

Structural imaging was “substantially sharper” than in the previous vintage dataset, with gathers “significantly” flatter with less noise, and the operator placing greater confidence in the amplitude versus offset analysis.

The board said the impact on what could be seen in the deepwater section of the licence was “especially pronounced”, allowing the operator to identify a deeper level slope, and three separate reservoir targets.

Those targets included a shallow section, a deeper slope section, and a basin floor fan section.

In addition, the company said the operator had been able to identify a new substantial lead in a submarine fan complex in the shallow-water Gamtoos area of the licence, which it estimated to contain 135 million barrels of oil equivalent recoverable resources, and had updated its estimates of the recoverable resources in the other leads it had already identified, some of which now appeared larger and others smaller.

Overall, the firm said the operator had increased the portfolio volumes by 54% as a result of reprocessing seismic data and reinterpretation.

“As previously noted, the Algoa-Gamtoos licence is located adjacent to Total's blocks 11B/12B, where Total has made discoveries in excess of one billion barrels of oil equivalent at Brulpadda and Luiperd, in the Outeniqua basin that runs across those blocks,” the board said in its statement.

“The Algoa-Gamtoos license also contains the southern deep-water basin margin of the Outeniqua Basin and is approximately 150 kilometres along strike to the east of Total's Brulpadda and Luiperd-1X wells.”

Tower said the Luiperd-1X well encountered 73 metres of good quality net pay in 85 metres of gross sands in the main target interval and, according to Africa Energy which owns 49% of Main Street 1549 Proprietary - one of Total's partners in the well - the well reached a maximum constrained flow-rate through a 58/64 inch choke of 33 million cubic feet per day of natural gas, and 4,320 barrels of condensate per day, making for an aggregate of about 9,820 barrels of oil equivalent per day.

“The choke configuration could not be increased due to surface equipment limitations,” the board said.

“The absolute open flow potential of the well is expected to be significantly higher than the restricted test rates.

“Current indications are that the Luiperd discovery is larger than the one billion barrels of oil equivalent Brulpadda discovery announced in 2019.”

At 1117 GMT, shares in Tower Resources were up 7.84% at 0.55p.