The Mosman Oil & Gas Ltd (LON: MSMN) shares rallied 16.7% after revealing that the proved reserves at its Cinnabar Project in Tyler County, Texas, had increased by 78%. In addition, the company noted that after the successful development and drilling of the Cinnabar-1 well, it commissioned an updated independent reserve report for the project.
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The reserve report was prepared based on the potential full-field development of the Cinnabar Project, where Mosman has a 75% Working Interest. The Cinnabar-1 well is the company’s most crucial producing asset, which is why today’s updated reserves are significant.
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Mosman said that the newly proved reserves now total 1.58 million barrels of oil equivalent comprising 1.13 million barrels of proved undeveloped reserves, 147,000 barrels designated as proved developed and ‘behind the pipe’ and 302,000 barrels designated as proved developed and producing.
The total proved results at Cinnabar-1 increased by about 78% to 1,581,000 gross boe from 887,000. Investors cheered the news, as evidenced by the rally in Mosman Oil & Gas shares, but the rally did not last long since MSMN shares were trading in negative territory at writing.
The company’s last announcement was in February when it received its sacred site clearance certificate for its project in the Amadeus Basin, within Australia’s Northern Territory, where it plans to conduct exploration activities.
Mosman Oil & Gas’s production report for the last quarter of 2022 showed that the firm produced 6,212 barrels of oil equivalent (boe) net during the three months to December. The company attributed the higher production numbers to higher production at the Greater Stanley, offset by lower production at the Arkoma and Winters projects.
John W Barr, the Mosman Oil & Gas Chairman, said: “We are extremely pleased with the new Reserve Report that confirms significant quantities of Reserves at Cinnabar. Cinnabar is now the most significant project in Mosman’s portfolio, both in terms of production and reserves. The Board can now consider the best way to commercialise these Reserves.”
*This is not investment advice.
Mosman Oil and Gas (MSMN) share price.
The Mosman & Gas (MSMN) share price surged 16.67% to trade at 0.07p, from Tuesday’s closing price of 0.06p.
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