Follow-up Thailand Appraisal Well 'Tests 659 Barrels Per Day'
Research Report

In a Dec. 3, 2018, research note, Bill Newman, a Mackie Research Capital Corp. analyst, reported that Pan Orient Energy Corp.'s (POE:TSX.V) appraisal well L53-DD2 is now producing at about 659 barrels per day (659 bbl/d) of 23.9 degree API oil from the EE sands, "the lowest of the four pay zones." On a net basis, this equals about 330 bbl/d of oil.

The L53-DD2 well is located within Pan Orient's L53 concession, and tested at this stabilized rate over a five-day period. It will be left to produce for the remainder of the 90-day test period.

Newman highlighted that the rate of oil L53-DD2 is producing is roughly comparable to what the discovery well L53-DD1 in the DD sands tested at, which was about 780 bbl/day, or 391 bbl/d net.

Therefore, combined production from L53-DD1 and L53-DD2 is about 1,759 bbl/d, or 879 bbl/d net. "We are very encouraged with the initial test results of both wells, which we expect to generate significant cash flow to fully fund a development and exploration program in Thailand in 2019," Newman noted.

That effort will constitute drilling of three wells: a second appraisal well, L53-DD3, on the L53-DD field in January; an appraisal well on the L53-B field; and an exploration well, L53AC-E, targeting the West A fault compartments in August.

Newman summarized that within the DD field at the L53 concession, five oil-bearing sands have been encountered. Of those, EE and FF, the lowest zones, have been successfully tested. The BB, CC and DD zones, which seem thicker with superior reservoir quality, will be tested in the future.

Mackie has a Buy recommendation and a CA$3.25 per share price target on Pan Orient, based on its "strong financial position, funded Thailand drilling program and high-impact exploration potential in Indonesia," indicated Newman. This energy company's stock is currently trading at around CA$1.52 per share.

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