Bahamas Petroleum progresses preparations for Perseverance 1 drilling

The AIM-traded firm said Perseverance 1 was on track to spud before the end of 2020, at 100% equity to BPC, with drilling of the potential basin-opening well expected to take between 45 and 60 days, with 'tight-hole' procedures in place.

It said it was targeting recoverable prospective resources of 0.7 billion barrels of oil, with an upside of 1.44 billion barrels, solely for the northern portion of the B structure.

In the event of success, Perseverance 1 would “substantially de-risk” the total B structure, which extended for between 70 and 80 kilometres, had a mapped areal closure of more than 400 square kilometres, and had a 'best estimate' aggregate recoverable resource potential of more than two billion barrels.

The Stena IceMAX drill ships had completed all necessary vessel and equipment inspections, and was scheduled to leave dock in the Canary Islands before the end of November, heading to location in preparation to drill the well.

Specific transportation procedures, isolation mandates and quarantine protocols were in place to minimise any risk of Covid-19 disruption to the operation, supplementing comprehensive, approved environmental safety standards and procedures, with the Bahamas Defence Force and US Coastguard briefed on operating and safety preparations.

All material contracts and supply arrangements were now completed, with logistics and mobilisation plans finalised.

The company had also received formal confirmation from the government of the Bahamas of a further extension of the second exploration period of its licences, from mid-April 2021 to the end of June 2021, reflective of the ongoing impacts of the Covid-19 force majeure.

Within BPC, the outcome of the Perseverance 1 well was now set within the strategic context of a portfolio business, with production and cashflow-generating assets and a “growing opportunity set” of complementary assets across multiple jurisdictions.

“Many shareholders have been extremely patient and have stayed the distance, as has the majority of the management team, and we are now in the position to deliver the Perseverance 1 exploration well in compliance with our long-held exploration licences in the Bahamas,” said chief executive officer Simon Potter.

“Perseverance 1 is a potentially basin-opening well, with the kind of scale and associated value uplift exposure rarely offered outside of oil majors.

“At the same time, our activities, in the event of success, have the capacity to be economically transformative for the nation of the Bahamas, and could ultimately contribute billions of dollars in royalty revenues to the national treasury, at a time when the dual impact of recent hurricanes and the Covid-19 pandemic has been especially hard-felt by most Bahamians.”

Potter said many other nations in the region such as the US, Mexico, Trinidad and Tobago, Suriname and Guyana, had in the past decade “safely and responsibly” drilled offshore wells, developed or continue to develop offshore hydrocarbon resources, and reaped the economic benefits of an established or a whole new industry.

“Moreover, these other nations have been able to do so at the same time as seeing growth and development of existing industry sectors, such as tourism.

“BPC is fully committed to ensuring safe and responsible operations, and has assembled an experienced team of drilling personnel, supported by many of the world's largest and most respected oil services contractors, with a collective track record of drilling many thousands of wells safely, all around the globe.

“We are especially pleased that one of the most modern, technically capable drilling vessels in the world will soon leave port ahead of drilling.”

Potter explained that in support of that, logistics plans to mobilise both equipment and personnel safely to site had been finalised, funding was in place, and the firm had completed a “huge body of work” to ensure that best practices have been applied as its health and environmental safety plans and protocols had been developed, contracted, and approved.

At 1226 GMT, shares in Bahamas Petroleum Company were down 4.6% at 3.32p.