Positive results from the Lachambre production test
Positive results from the Lachambre production testLATEST
FACT
The production test at Lachambre, Lorraine (Eastern France) has given good results.
The production curve and the maximum flow levels confirm the potential for development. The tested vein (n.15) has technical specifications similar to, or better than, coalbed methane (CBM) projects currently producing in Australia, Asia and North America.
ANALYSIS
This is a key step for LFDE in the context of its concession application, which should be submitted in H1 18.
In Lorraine, LFDE exploration permits have maturities ranging over 2018-19. The group should be able to apply for a concession on the back of the Lachambre test.
A word about French regulation
The French government in autumn 2017 issued a new regulation (“Loi Hulotâ€) to stop the issuance of new exploration permits in France.
According to the company, the government’s stance on hydrocarbon exploration only concerns new exploration permits, while the existing concessions and ongoing applications on existing discoveries would be unaffected.
IMPACT
In our SOTP, we may slightly increase the estimated probability of extracting the contingent resources in Lorraine and reduce the probability related to the Lorraine reserves, on the back of the regulatory environment.
La Francaise de l'Energie is engaged in the operation of the French energy sector, with gas assets in northern and eastern France, specifically coal bed methane. Co. aims to substitute a portion of the gas imported into France with coal bed methane, which it produces, due to its low carbon footprint and production cost. Co.'s operations are mainly located in two areas: Lorraine, located in eastern France close to the Franco-German border, and in Nord-Pas-de-Calais, in the Hauts-de-France region located at the Franco-Belgian border. Co. operates in two operating segments: Lorraine which includes the exploration and certification of gas reserves and Avion which includes gas production.
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