Regal Petroleum initial testing on MEX-105 well disappoints

The initial testing on Regal Petroleum’s (RPT LN) newly drilled MEX-105 well demonstrated “weak gas flow,” the company said in its operations update on June 6. It will perform acid stimulation to improve gas flow rates from the well. Production from the SV-53 well, which indicated an encouraging 1,187 boepd flow rate during initial testing in November, has been stabilized at 56 boepd, Regal said. The company’s overall hydrocarbon output year-to-date has averaged 1,526 boepd, flat compared to 1,539 boepd in 2012. The SV-59 well has reached a depth of 3,800 meters and is expected to reach a target depth of 5,470 meters by the year end.

Roman Dmytrenko: The acid stimulation of MEX-105 and workover at the GOL-1 wells would likely allow the company to maintain its current production throughout the year. However, its optimistic target to double output this year is unachievable. With the company’s next well to be completed only by the year end, it looks like this will be a year of zero production growth for Regal in the best-case scenario.