Block Energy (LSE:BLOE) has successfully concluded a carbon capture and storage (CCS) pilot at the Patardzeuli Field in Georgia, with independent verification confirming the reservoir’s suitability for long-term carbon dioxide sequestration.
Technical analysis by Oilfield Production Consultants determined that the Middle Eocene formation can permanently contain injected CO₂. During the pilot, 13.64 tonnes of carbon dioxide dissolved in water were injected into the reservoir. Ongoing monitoring and laboratory assessments showed that the CO₂ mineralised rapidly into stable carbonate minerals within one to three months, with no signs of gas migration or leakage detected.
The findings point to supportive geological and operational characteristics at the site, including reactive volcaniclastic rock, zeolite-rich intervals, and under-pressured reservoirs that reduce injection energy requirements. The presence of legacy wells further enhances cost efficiency by allowing existing infrastructure to be repurposed.
Following the positive results, Block Energy and its joint venture partner Rustavi Azot, part of Indorama Corporation, are advancing to a feasibility stage. This next phase will examine scalability, regulatory considerations, and commercial viability of full-scale CCS deployment. Management believes the project could contribute to regional industrial decarbonisation while establishing a potentially low-cost, infrastructure-driven revenue stream for the company.
Despite the technical milestone, the company’s broader outlook remains constrained by falling revenues and continued losses, reflected in negative margins and return on equity. Valuation indicators are also limited in usefulness due to a negative price-to-earnings ratio. Balancing these pressures are a relatively robust capital structure with low leverage and signs of improving cash flow, alongside strong recent share price momentum. However, a very elevated RSI suggests the rally may be stretched in the near term.
More about Block Energy Plc
Block Energy Plc is an AIM-listed energy company focused on oil and gas development and production in Georgia. In addition to hydrocarbon operations, the group is exploring carbon capture and storage initiatives aimed at leveraging existing infrastructure to support industrial emissions reduction while diversifying its long-term revenue base.
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