Most recently, in Thailand, drilling of the L53-DD9 appraisal well was done, which encountered a total of about 29 meters of net oil pay in the four primary producing sands, AA, BB, CC and DD. Testing of L53-DD9 should start in the next 10 days.
The company noted that the "L53-AA2 exploration well represents a potential new pool discovery, outside the recently approved L53 South AA Production Area." The well was put on production in Q3/20 and yielded 45 barrels of oil per day (45 boe/d) net to Pan Orient in September. Now it is producing 29 boe/d. "Production performance of the L53-AA2 well will be monitored over the remaining period of the 90 day production test. A final decision will be made at the end of the 90 day period whether to proceed, or not, with a Production Area application for the L53-AA2 structure," the release stated.
Pan Orient has been developing its L53-DD oil field reservoir model, incorporating into it the newly drilled well results, for a reservoir simulation study it expects to finish by year-end 2020.
Net sales of oil produced from the L53 Concession amounted to 1,575 boe/d in September. Adjusted funds flow from the Thailand operations in Q3/20 was CA$3.5 million. At quarter's end share of working capital and long-term deposits was CA$3.5 million. Thailand cash flow is expected to fund further exploration and development at L53.
At the corporate level, Pan Orient's Q3/20 adjusted cash flow from all of its operations, including the Thailand joint venture, was CA$2.4 million. During the quarter, Pan Orient repurchased 98,000 shares in Q3/20 at an average price of CA$0.61 apiece. At Sept. 30, 2020, the company had CA$29.9 million in combined working capital and deposits and no debt. Its Q3/20 loss was CA$1.1 million, or CA$0.02 per share.
Looking forward, "the focus for the remainder of 2020 will be on development-related activities in Thailand, growing our cash balance by maximizing funds generated from operations and achieving full recognition of L53-DD field oil reserves in the year-end 2020 independent third party reserves report," President and CEO Jeff Chisholm said in the release.
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