Nu-Oil & Gas Announces Completion of Due Diligence on EL1070 by G2 Energy
Monday 13 February 2017
NU-Oil and Gas has announced that further to its announcement on 21 December 2016, regarding the Option Agreement on EL1070, offshore Western Newfoundland with G2 Energy, G2 Energy has successfully completed its due diligence on EL1070. Under the Option Agreement, G2 Energy has an exclusive option to earn 100% of the Company's working interest in the Deep Rights (see below) on EL1070, with the Company's wholly owned subsidiary, Enegi Oil, retaining a 5% gross overriding royalty should the option be exercised.
G2 Energy is now proceeding with the work required to submit an application for a Significant Discovery Licence ('SDL') on EL1070. In this respect, prior to the end of the option period of 24 months from 16 December 2016, G2 Energy must achieve a flow test for hydrocarbons on one or more of the wells on EL1070, a requirement under the regulations for the submission of an application for a SDL.
The Deep Rights within EL1070 are currently held by EOI.
G2 Energy has undertaken further analysis of data on existing wells, and has identified a potential bypassed oil pay zone behind casing in one of the wells on the licence, within the Carbonate Platform section (see below "About EL1070"), and its initial work programme, subject to regulatory approval, will plan to flow test this prospective zone. This section is interpreted to have a dense natural fracture network in brittle carbonate rocks, which may have natural flow capability.