JKX Frac Operation In Ukraine Successful

August 30, 2013

JKX Oil & Gas plc has successfully completed the 10 stage multi-stage frac in well R-103 in Ukraine, the company reported in a news release. The frac crew and equipment are now being demobilised. The remaining plugs separating the frac stages are currently being drilled out and flow-back has commenced. This flow-back phase is expected to take approximately 3 to 4 weeks with stabilised gas flow data expected in a further 4 to 5 weeks.

JKX s Chief Executive, Dr Paul Davies, said, "We are very pleased to have successfully completed this 10 stage frac operation in Ukraine. Conditions have been difficult but overall the execution has been better than anticipated. Seven of the frac stages have achieved or exceeded design predictions, two were below expectations and only one was unsuccessful. The next few weeks of clean- up and flow stabilisation will be critical and we are encouraged that the well is already flowing gas to surface together with frac fluids.

As reported on 19 August, an extra frac interval was added at Stage 8 following the disappointing result from the Stage 5 frac, taking the total planned frac stages to ten.

Stage 8 turned out to be a textbook operation with all plug setting, perforating, mini-frac and main-frac operations performing to plan. Total proppant injected was 123 tons, total volume of gel and fluid was 599 cubic metres and the pump rate reached 5.0 cubic metres per minute (45,000 bpd) with a maximum pump pressure of 672 bar (9,750psi). The propped frac length was calculated at 242m with an average width of 3.0 mm.
Stage 9 was more difficult with higher pressures encountered during the mini-frac. Despite this, the main-frac was carried out successfully with a total of 62 tons of proppant and a total volume of 496 cubic metres of gel and fluid injected. However, a pump pressure of 775-795 bar was required to achieve a pump rate of 3.8 cubic metres per minute (34,000 bpd) with the maximum pump pressure reaching 810 bar (11,750 psi). The propped frac length was calculated at 145m with an average width of 3.8 mm.

Stage 10 was predicted to be in a high stress and low permeability zone similar to Stage 9, despite being at the shallowest point of the overall multi-frac operation. However, the pumps were unable to achieve breakdown at this interval, even with a pump pressure of 825 bar (11,960 psi). Consequently, this final frac stage was abandoned.

The coiled tubing unit is now drilling out all the remaining plugs to connect up the full well bore for final flow back. Nitrogen is available to help lift the spent frac fluids from the well but, with gas already flowing to the flare, early indications are that this will be an aid rather than an essential support. The total volume of fluid injected was 4,600 cubic metres (29,000 barrels) and we expect to recover 15-25% of this volume before liquid- free gas flow commences.

The well will continue to