Jupiter Energy brings on three more oil wells in Kazakhstan
Jupiter’s Akkar East oilfield has been approved to move from exploration to commercial production status.
Kazakhstan oil producer Jupiter Energy (ASX: JPR) has received all necessary approvals for its Akkar East oilfield to move to commercial status with three new wells already producing.
Until now, oil production has been limited to two earlier wells while the company awaited the all clear from the government for this latest expansion.
In the June quarter, Jupiter pumped 31,700 barrels of oil, earning US$463,500 (A$634,280).
Following the approvals, wells J-51, J-52 and 19 have resumed production during what is known as the “preparatory period” under Kazakhstan’s Sub-Surface Code.
This period allows an operator to transition between trial production (during which gas can be flared) to commercial production, which requires the operator to capture all the gas.
Also during this preparatory period, the necessary gas infrastructure is not required so long as the company uses the gas at the project.
But the three oil wells will only operate at 30% of capacity during the transition period, otherwise more gas would be produced than could be utilised on the field.
Jupiter Energy owns 100% of Block 31 in the Mangistau Basin, West Kazakhstan. The ground was acquired by the company in 2008 and has a history of oil production.
Block 31 is currently 123sq km in size and the entire permit covers an area of proven oil production. The company has its operations based in the port city of Aktau, 80km from Block 31, on the Caspian Sea coast.
Jupiter looking to scale up to handle export market
Meanwhile, the Akkar North oilfield will need to transition to commercial production during the first quarter of 2021 and the West Zheyybai oilfield will go through the same process in the fourth quarter of 2021.
The longer-term plan for Jupiter Energy is to develop Block 31 to process, store and export oil.
In the 12 years of operations in this central Asian country, Jupiter has discovered the three oilfields and produced about 1 million barrels of oil.
In July, the company announced a strategic review of the options for its Kazakhstan ground.
It engaged a Russian financial firm, JSC VTB Capital, to undertake the review as, with the move into commercial production, there will be a need for greater investment in infrastructure to enable access to the export market.