Sacgasco hits its ‘most significant’ gas find yet off California
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Gas explorer Sacgasco reported a “significant” gas discovery in its Californian Dempsey project on Friday.
The energy company jumped to 9.9c on Friday morning, but drifted to 9.2c at the close, up 2 per cent.
Sacgasco’s (ASX:SGC) share price has climbed 41 per cent since the start of the year as it moved closer to launching drilling stages.
The energy company said exploration drilling at its Dempsey 1-15 well in Sacramento Gas Basin had located a potential sandstone reservoir with “high gas shows”, but isn’t yet speculating on how big it could be.
A “gas show” is an escape of gas from underground deposits.
Sacgasco will be at the RIU Good Oil Conference in Perth this week September 13-14.
Sep 13-14 at Hyatt Regency Hotel, Perth
Before drilling began the area was estimated to hold as much as 1 trillion cubic feet (TCF) of recoverable gas.
“The latest shows are interpreted to be the most significant we have seen to date,” said Sacgasco managing director Gary Jeffery.
“It continues to be very encouraging that since drilling out of the 9 ⅝ [inch] casing, all potential reservoir zones interpreted from mud logs have been associated with significant gas shows.”
The Dempsey well initially tested shallow targets in an existing gas field, before hitting deeper reservoirs in stacked conventional sandstone in the Sacramento Gas Basin. The final depth will be 3200 metres.
Raising some moolah
Late last week Sacgasco said it had raised another $2.4 million from new and existing sophisticated and institutional investors in both London and Australia to fund the Dempsey project and another in the area, the Alvares Prospect.
The Alvares Prospect is an old oil well where, in 1982, high-pressure gas shows were discovered. Sacgasco wants to tap into the original well, which had been plugged, to see how large the gas field might be, estimating it could hold up to 2.4 TCF.
The share placement excluded existing ordinary shareholders, who saw their holdings diluted by 13.5 per cent.
Sacgasco clearly wanted funds fast.
“Due to various factors including the amount of capital being raised and timing of cash requirements of the company, the directors formed the view that the time and cost involved in a pro‐rata rights issue was not in the short or long term interest of the company, or its shareholders,” the company said.
Sacgasco has been contacted for comment.
17th RIU Good Oil Conference
Stockhead is a sponsor of the 17th RIU Good Oil Conference at the Hyatt Regency Perth Hotel on Wednesday and Thursday this week.
Over its long tenure of existence the RIU Good Oil conference has been considered the premier Oil & Gas conference for the mid-tier and junior Companies to promote their exciting developments and opportunities.
The upcoming 2017 RIU Good Oil Conference program strongly supports its outstanding reputation. Over the two-day event the 450-plus delegates will hear up to 44 presentations ranging from ASX listed oil and gas companies, investment analysts and specialists from the oil and gas industry.
Two of the Keynote presenters are Kevin Johnson, Executive Director, Corporate Stockbroking of major sponsor Argonaut Securities who can be heard giving his wisdom on the Perth Radio Station 6PR and Justin Smirk (as seen on TV), Director Economics, of Westpac Institutional Bank, the conference’s longest running sponsor.
Both will be giving their well researched views on the oil and gas industry and how it impacts on the market and the overall economy. Other major continuing sponsors are Tolehouse, Risc, Upstream Production Solutions and Lind Partners while new Sponsors BDO and HopgoodGanim Lawyers will be providing expert opinion to the program.