Valeura Energy Inc. provided status of the Yamalik-1 well operations. The corporation has temporarily suspended testing operations on the Yamalik-1 well and has released the fracing and testing equipment after accomplishing the primary objectives of the testing. The Yamalik-1 well testing program was designed to demonstrate that fracing would allow gas to flow to surface from these deep, tight reservoirs, and without the production of formation water. Both of these factors are key components to demonstrate the presence of a basin-centred gas accumulation. The production testing results have exceeded expectations. The 24-hour aggregate production test rate of 2.9 million cubic feet per day ("MMcf/d") from the four production tests in the Kesan formation was better than modelled. Additionally, the gas was at a higher pressure than expected and the gas flowed with a significant amount of condensate (with a test data range of 20 to 70 barrels per MMcf). The corporation is currently proceeding with engineering and design work to enable Yamalik-1 to be tied into its gas gathering and sales network. When the pipeline and surface equipment are ready, the corporation plans to clean out the well with fit-for-purpose milling and testing equipment. The well would then be further tested and placed on production through smaller diameter production tubing which should improve the production of natural gas and condensate from the well, and allow for a better understanding of the performance of the fraced reservoirs. While the corporation is targeting to recommence operations by the end of the first quarter, this timing may be delayed if it is determined that the high-pressure gas necessitates the use of special completion equipment with a longer procurement time. 

The company reported operational results for the fourth quarter of 2017. Net petroleum and natural gas sales in the fourth quarter of 2017 averaged approximately 1,038 barrels of oil equivalent per day ("boe/d"), which was up approximately 1% from third quarter of 2017 reflecting additions from four well workovers, offset by natural declines. December 2017 exit net sales were 929 boe/d compared to earlier guidance of 1,000 to 1,100 boe/d. This shortfall was due to a decision to defer execution of two well re-entry fracs in the Tekirdag area to late December given the high activity levels in support of the Yamalik-1 testing program. The two re-entry fracs were successfully completed in the Kayi-14 and Baglik-1 wells in normally-pressured, tight gas sands in the Teslimkoy formation. A single stage frac was completed in the Kayi-14 well over a depth interval from 1,195 to 1,248 metres. The well has been on-stream since December 27, 2017 and has produced at an average restricted rate of 0.6 MMcf/d (gross) through a 22/64" to 26/64" choke over the past 16-day period. A two-stage frac was completed in the Baglik-1 well on December 28, 2017 over a depth interval from 846 to 938 metres. The well has been on-stream since January 8, 2018 and has produced at an average restricted rate of 1.0 MMcf/d (gross) through a 20/64" to 24/64" choke over the past 4-day period. Both of these wells are currently on-stream and contributing to the corporation's gas sales.