Exploration/Development Briefs

Nov. 12, 2012

Australia

Magellan Petroleum Corp., Denver, let a contract to Seabird Exploration FZ-LLC for the seismic recording vessel Voyager Explorer to undertake a 75-sq-mile 3D and an 84-mile 2D seismic survey on Magellan's NT/P82 exploration permit in the Bonaparte basin offshore Australia. Shooting is to take 2 weeks starting in the second week of December. Interpretation is expected to take the following 3 months.

Magellan has 100% interest in NT/P82, which lies in 55-400 ft of water 160 miles northwest of Darwin.

Under license terms and pending seismic results, Magellan is required to drill a well by May 2015. The company expects to incur $4.5 million to shoot, process, and analyze the seismic.

Israel

Adira Energy Ltd., Toronto, will farm out partial interests in its Mediterranean licenses off Israel to Tohar Hashemesh Ltd. Adira will farm out 5% of its working interest in its Gabriella license, 10% of its Yitzhak license, and 10% of its Samuel license. Also, 2.5% of Adira's working interest in Gabriella will be carried.

Gabriella is to be drilled in the first half of 2013, followed by Samuel and Yitzhak later next year.

Meanwhile, Israel's Ministry of Energy and Water extended the date for executing a drilling contract on the Samuel license. Tohar Hashemesh will reimburse $1.6 million or 50% of Adira's costs incurred on the licenses and will pay the other 50% upon registration of its interest with the ministry. Additional terms and conditions apply.

Following approval of the agreements, excluding options granted to Tohar Hashemesh, Adira will hold 10% of Gabriella in addition to the 15% back in option, 50% of Yitzhak, and 31.25% of Samuel.

A group led by GeoGlobal Resources Inc., Calgary, will plug and abandon the Sara-1 deepwater exploratory well offshore Israel after drilling it to 3,928 m true vertical depth subsea in 1,400 m of water.

Cuttings and logs indicate that the well encountered 98 m of high-quality reservoir sands in the Lower Miocene/Upper Oligocene that had good porosity and permeability. There were indications that gas has migrated through the system, but the sands are wet with no commercial quantities of hydrocarbons, GeoGlobal said.

Earlier this year, logs at the Myra-1 wildcat on the Myra license confirmed the presence of high-quality Lower Miocene sands equivalent in age to the Tamar sands and gas shows that indicate an active hydrocarbon system on the Myra license (OGJ Online, Sept. 16, 2012).

GeoGlobal said it believes there are more prospects on the Myra and Sara licenses and in the basin and that it plans to further refine the geological model and evaluate the other potential targets.

"Having completed the work programs in Myra and Sara the company is now qualified as a deepwater operator in Israel. We intend to use this qualification to open up new opportunities to us in the basin and abroad," GeoGlobal said.

Kenya

Tullow Oil PLC said its Twiga South-1 exploratory well on Block 13T in northwestern Kenya has encountered oil.

Drilling is still in progress, and final results are expected in early to mid-November after it has reached target depth and necessary sampling and analyses have been carried out, Tullow said. The company released no depths or details.

Tullow Oil and Africa Oil Corp., Vancouver, BC, each hold a 50% interest in the Twiga South well.

The Twiga South-1 structure is the second prospect to be tested as part of a multiwell drilling campaign in Kenya and Ethiopia and is the first discovery in Block 13T following the Ngamia-1 discovery earlier this year in Block 10BB.

Oman

DNO International ASA said the West Bukha-4 well on Block 8 offshore Oman has flowed at 7,000 b/d of 39° gravity oil and 15 MMcfd of gas on a 54⁄64-in. choke through a test separator.

West Bukha-4 will be connected to the pipeline within days and at the initial test rate is expected to nearly double oil production from West Bukha field to 15,000 b/d.

As the longest reach well drilled off Oman, West Bukha-4 at nearly 6,000 m targets an area not penetrated by previous drilling and is the second of a three-well drilling campaign initiated last year in Block 8.

DNO International has a 50% interest in and operates the block containing West Bukha and Bukha fields and their respective platforms. South Korea's LG International has the remaining interest.

Yemen

DNO International ASA said Nabrajah-21, its first horizontal well in the Cretaceous Qishn formation in Yemen, is averaging 800 b/d of oil and has boosted production from Nabrajah field on Block 43 to 2,200 b/d.

DNO has spudded a second horizontal well, Nabrajah-20, before moving the rig to Block 47 to drill the Yaalen-3 well as part of the Yaalen field development plan. DNO operates Block 43 with a 56.67% interest.

As the result of Nabrajah-21, the return to production offshore Oman, and the resumption of oil shipments from Tawke field in the Kurdistan Region of Iraq, DNO's recorded production of 41,545 b/d of oil equivalent on a company working interest basis in the quarter ended Sept. 30, up from 23,234 boe/d in this year's second quarter.

Quebec

Petrolia, Rimouski, Que., said it has installed tubing and will conduct a sustained production test of an open hole interval at 1,832-2,746 m in the Bourque-1 well in Quebec to see if it can obtain commercial oil flows.

Petrolia drilled the well to 3,140 m measured depth, 2,921 m true vertical depth, at a site halfway between Murdochville and Grande-Vallee on the northern side of the eastern Gaspe Peninsula. Wet gas shows containing condensate (C3 to C7+) in concentrations of up to 20% were registered over an 1,850-m interval between 995 and 2,852 m.

Each of eight drillstem tests of 20 to 30-m intervals yielded gas-condensate to surface. The most promising rate was 1.4 MMcfd. A small amount of light petroleum was also recovered in the drilling mud.

Starting at a depth of 1,465 m, in the cased section of the well, is a massive interval for which electric logs indicate porosity over a thickness of more than 100 m. This zone is characterized by abundant calcite from fractures and localized high-temperature dolomite. All drill cuttings from this zone displayed fluorescence when cut with a solvent, an indicator of oil in the rock.

In addition, a substantial show of gas was recorded at the top of the interval in a fractured zone, and 53° gravity oil was recovered in the sample chamber. This result led Petrolia to add oil as an objective for well Bourque No. 2.

Meanwhile, the company has moved the rig to the Bourque-2 site.

California

Sovereign Resources LLC, Dallas, has signed a letter of intent under which it would form a joint venture with Underground Energy Corp., Santa Barbara, Calif., on part of Underground's Zaca field extension project in Santa Barbara County, Calif. Sovereign will have the right to earn as much as a 75% working interest in Underground's and its joint operating partner's interest in 2,857 gross acres of the northwest corner of the extension project. Underground owns 80% of the leasehold interest in the joint venture lands and a total 10,482 net acres across its Zaca asset.

Sovereign would enter into a continuous drilling program to drill a maximum of seven wells to earn its full working interest. Underground and its minority partners will be carried for wells one and two, but thereafter will have the right but not the obligation to pay their share of drilling and related costs for each subsequent well. Underground believes drilling will start within 6 months.

Colorado

Carrizo Oil & Gas Inc. and Haimo Oil & Gas LLC will form new joint venture in the Niobrara play in the Denver basin in northeastern Colorado.

Haimo Oil & Gas, a unit of Lanzhou Haimo Technologies Co. Ltd., will acquire an undivided interest in 6,000 net acres in Weld and Adams counties plus associated infrastructure and 185 b/d of oil equivalent production for $27.5 million cash. The transaction is subject to closing conditions, including Chinese government approvals, and purchase price adjustments.

The sale will be effective as of Oct. 1, the same effective date as in Carrizo's separate Niobrara joint venture agreement with OIL India (USA) Inc. and IOCL (USA) Inc, subsidiaries of OIL India Ltd. and Indian Oil Corp. Ltd., respectively.

Following the closing of this transaction late in the fourth quarter, the venture interest ownership participations in Carrizo's Niobrara development activities will stand at 60% Carrizo, 30% OIL/IOCL, and 10% Haimo.

Pennsylvania

Ultra Petroleum Corp., Houston, said encouraging results from its own wells and public data from adjacent third party wells affirm the commercial viability of the Upper Devonian Geneseo formation on the majority of Ultra's Pennsylvania leasehold.

Ultra continues to evaluate Geneseo potential. Two new wells were brought on line during the quarter ended Sept. 30, one in Tioga County and one in Clinton County. The company did not provide rates for the new wells.

To date, Ultra and its partners have completed 5 gross (3 net) horizontal wells in the Geneseo.

Wyoming

The US Bureau of Land Management's Rock Springs, Wyo., field office launched a 30-day public scoping period prior to beginning an environmental assessment of Anadarko Petroleum Corp.'s proposed expansion of the Patrick Draw field.

Anadarko is considering development of up to 125 new oil, carbon dioxide, and expansion wells in the area roughly 30 miles east of Rock Springs, BLM's Rock Springs, Wyo. field office said. It said the field is in a checkerboard pattern of mixed ownership covering 32,781 acres of primarily federal and private land with some state acreage. The Patrick Draw field includes the Monell and Arch Units, which were developed in the late 1950s to early 1960s and currently support 128 producing wells.

The new proposal includes a combination of vertical and directional drilling of 105 oil wells, 18 carbon dioxide injector wells, and two water injection wells to be developed during the next nine years, the notice said. The planned project anticipates 160 acres of maximum surface disturbance, with the life of the wells projected to be roughly 30 years, it said.

Utah

Berry Petroleum Co., Denver, said it purchased 14,000 net acres with a 96% working interest contiguous to Brundage Canyon oil field in the Uinta basin in northeastern Utah for $40 million.

Berry expects the acquisition to add 200 identified drilling locations in addition to the 350 Ashley Forest locations gained from the environmental impact statement approval Berry received in the quarter ended June 30. Berry has added 28,000 net acres to its Uinta position in 2012.

Production from the firm's Uinta properties averaged 5,940 boe/d in the quarter ended Sept. 30, 5% higher than the previous quarter.

The firm ran four rigs and drilled 37 commingled Green River/Wasatch wells targeting higher oil potential areas. Across the basin, The firm plans to drill 26 more commingled wells in the fourth quarter.