Monumental Energy Corp said Tuesday it had completed the issuance of 16.2 million units for CAD 0.05 per unit in an oversubscribed non-brokered private placement, generating gross proceeds of CAD 810,000 ($580,000).
Vancouver, Canada-based Monumental said in an online statement it would use net proceeds “to fund cost overruns on Copper Moki 1 oil and gas well, to fund the costs and expenses to formally enter into and fund additional workover projects with New Zealand Energy Corp. and L&M Energy and for general working capital purposes and corporate expenses”.
“Each unit is comprised of one common share in the capital of the company and one transferable common share purchase warrant”, Toronto-listed Monumental said. “Each warrant entitles the holder thereof to purchase one additional common share of the company at a price of CAD 0.08 per share until November 18, 2028.
“In connection with the private placement, the company paid in consideration of the services rendered by certain finders an aggregate cash commission of CAD 38,850 and issued an aggregate of 777,000 non-transferable common share purchase warrants. Each finder warrant entitles the holder thereof to purchase one additional common share of the company at the issuer price until November 18, 2028”.
Last month Monumental said it has agreed to fund New Zealand Energy Corp’s (NZEC) share of workover costs to restart flows at several wells in the Waihapa/Ngaere field in the onshore Taranaki basin.
“These workovers will follow the same royalty structure as that established for the successful Copper Moki programs, whereas Monumental will earn a 25 percent royalty on NZEC’s production share after full recovery of its capital investment, which will be repaid from 75 percent of NZEC’s net revenue interest”, Monumental, a shareholder in NZEC, said in a press release October 15.
L&M Energy will shoulder the remaining investment as NZEC’s equal partner in the campaign, Monumental said.
The workovers involve the Waihapa-H1 well and the Ngaere 1, 2, and 3 wells.
“The Waihapa-H1 well, drilled in the early 2000s, initially flowed oil at rates of approximately 1,500 barrels per day from fracture porosity within the Tikorangi horizontal section”, Monumental said. “Production ceased due to a collapse in the upper section of the wellbore.
“A workover program proposed to return the well to production includes jetting clean-out and the installation of new tubing. The well site is located approximately 600 meters from, and easily connected to, the Waihapa production facility.
“The Ngaere 1, 2, and 3 wells historically produced oil from the Tikorangi Formation. However, a review of electric logs and drilling data has identified multiple shallower, hydrocarbon-charged sand intervals in each well that present opportunities for additional oil and gas production. A field redevelopment program has been designed to access and produce these bypassed pay zones.
“The steel casing in each well will be perforated at the target intervals, followed by production testing. All three wells are connected via existing pipelines to the Waihapa production and export facilities, allowing for immediate oil and gas sales upon successful completion.
“In the event of success, anticipated flow rates per well are expected to range from the tens to low hundreds of barrels of oil per day”.
In late July Monumental restarted production at the Copper Moki-1 well, marking the completion of its workover campaign in Taranaki’s Copper Moki field with the earlier reactivation of Copper Moki-2, according to announcements by the company.
It said in an update August 19, “Both Copper Moki-1 and Copper Moki-2 have been onstream for almost a month delivering a combined production rate of approximately 125 barrels of oil per day. These rates continue to trend upward as pump speeds are gradually increased to optimize flow while preventing sand from entering the borehole”.
“In addition to oil production, both wells are now exporting associated gas to the neighboring Waihapa Production Station for processing and sale”, Monumental added.
Copper Moki started production 2011. Flows halted 2022, according to data from New Zealand’s Business, Innovation and Employment Ministry.
To contact the author, email jov.onsat@rigzone.com
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