Exploration/Development Briefs

June 24, 2013

Australia

Inpex Browse Ltd. has been awarded a 305 sq km block southeast of giant Ichthys gas-condensate field and Prelude and Concerto gas fields offshore Western Australia.

The WA-494-P permit is in 190-250 m of water 400 km north-northwest of Broome. Inpex is operator with 100% participating interest.

Magellan Petroleum Corp., Denver, plans to offer for farmout part of its interest in the NT/P82 exploration permit in the Bonaparte basin offshore Western Australia later this year.

The company is processing 3D and 2D seismic shot on the block, which lies in 55-400 ft of water 160 miles northwest of Darwin (OGJ Online, Nov. 1, 2012).

Magellan is in the final stages of processing the seismic shot in 2012. Due to certain characteristics of the subsurface geology, parts of the data need to be reprocessed and final reprocessed results will not be received until July.

After interpreting the data, the company will initiate a farmout process. Based on recent similar deals in the Bonaparte basin, the expectation is to give up operatorship and a large working interest in exchange for carry on exploratory wells. Magellan is required to drill by May 2015.

Colombia

Anadarko Petroleum Corp. and Ecopetrol have let a contract to CGG to acquire and process 5,500 sq km of 3D seismic in the Caribbean offshore Colombia.

The survey, the largest marine seismic program in the country, will cover parts of the Col 5, Ura 4, Fuerte Norte, Fuerty Sur, and Purple Angel blocks. The 4-month survey is to start in this year's fourth quarter.

Namibia

A group led by a unit of HRT Participacoes em Petroleo SA, Rio de Janeiro, has spudded the Murombe-1 exploratory well on PEL 23 in the Walvis basin offshore Namibia.

HRT Walvis Petroleum (Pty.) Ltd. said the Murombe 2212/06-1 well will test a 1,000 sq km basin floor fan on a four-way dip closure at its highest structural elevation in a turbidite complex of Barremian age. The drill site is in 1,391 m of water 220 km northwest of Walvis Bay.

This well, second in a three-well program, is 15 km east of HRT's Wingat-1 well on PEL 23 that penetrated two excellent oil source rocks from which liquid hydrocarbons were recovered. At Murombe, a shallower secondary objective, the Santonian-age Baobab confined channel complex with turbidite reservoirs, which is between the two source rocks, will also be evaluated.

Boabab is expected at 3,670 m below sea level and Murombe at 5,090 m. Drilling time is an estimated 72 days to 5,360 m.

The tender process has been completed for a high-resolution gravity and magnetic survey on 5.3 million acres of blocks in the Owambo basin in northern Namibia in advance of a reconnaissance 2D seismic grid to be shot in 2014.

Hydrocarb Energy Corp., private Houston concern, is operator of Blocks 1714A, 1715, 1814A, and 1815A and is reprocessing existing 2D seismic data. Block 1815A contains the Oponono prospect.

Under a farmout from Duma Energy Corp., Houston, Hydrocarb Energy has a 51% interest in the blocks, Duma has 39%, and Namibia's NAMCOR 10%.

Tunisia

A unit of DNO International ASA, Oslo, has taken a farmout on the Sfax Offshore exploration permit and the Ras El Besh concession in Tunisia from Atlas Petroleum Exploration Worldwide Inc. and Eurogas International Ltd.

The agreement contemplates the transfer to DNO Tunisia of an 87.5% participating (100% paying) interest in the permit and concession. DNO Tunisia will assume operatorship and a prorata share of the existing cost oil pool. Completion of the transfer is subject to approval by Tunisian authorities and other conditions.

The permit and concession cover a combined 3,296 sq km in the Gulf of Gabes mostly in shallow water. To date, three discoveries have been made with a combined 35-60 million bbl of gross recoverable oil resources. The assets also contain 29 identified prospects which in the aggregate are estimated to contain 500-700 million bbl of gross unrisked oil resources.

The initial work plan includes drilling two exploratory/appraisal wells in 2014, one on the Salloum discovery and the other on the Jawhara discovery. The 1991 Salloum-1 well tested 1,848 b/d of oil, and the 1976 Jawhara-1 well tested 1,484 b/d of oil. The 1997 Rash El Besh-1 well tested 612 b/d of oil.

DNO International currently holds interests in the Hammamet Offshore exploration permit and the Fkirine prospecting permit.

Ukraine

KUB-Gas LLC, in which Cub Energy Inc., Houston, has a 30% effective ownership interest, has spudded the North Makeevskoye-3 exploratory well on its properties in eastern Ukraine.

The directional well has a planned measured total depth of 2,500 m and main objectives in multiple stacked targets of Triassic to Visean age. The KUB-Gas rig is drilling the well 10 km northeast of the Olgovskoye-15 gas discovery well.

Meanwhile, Cub Energy has completed the acquisition of a private Ukrainian oil and gas exploration company, increasing its undeveloped land holding in Ukraine to 244,000 gross, 180,000 net acres.

The company expects to begin shooting 3D seismic on the three 100% working interest licenses in the third quarter of 2013 and drill the first well in early 2014.

Vietnam

A third prospect has been identified on Eni Vietnam BV-operated Block 120 offshore southeast of Da Nang, Vietnam, from 500 sq km of 3D seismic shot in mid-2012, said partner Neon Energy Ltd., Perth.

The seismic program was designed to delineate prospects near BHP Petroleum's 1993 120-CS-1X well, which encountered 32 m of oil shows and a 6-m oil column in Miocene reef carbonates, confirming the presence of a working petroleum system.

The 3D seismic data has advanced the joint venture's understanding of the potential reservoir and hydrocarbon distribution on Block 120 and revealed an additional prospect, Ca Ngu, which together with Rua Bien and Ca Lang is a candidate for drilling of the first exploratory well.

The improvement in seismic data quality reveals an Oligocene synrift section much thicker than previously thought, which potentially increases the volume of mature source rock available to generate hydrocarbons, Neon Energy said.

The associated increase in depth of burial of the prospective Oligocene section also opens up the possibility of local gas generation within the synrift half-graben. The seismic character of shallow objectives with strong amplitude anomalies in Rua Bien and Ca Ngu support the presence of at least some gas in the reservoir.

As such, the three primary prospects within Block 120 are now regarded as prospective for both oil and gas. The Block 120 production sharing contract provides for a higher contractor profit share of gas than for oil.

Seismic interpretation and analysis of the three prospects is nearing completion, and volumetric and risk assessment will lead to prospect selection by the joint venture in July 2013, and drilling is expected to begin in September.

Working interests in Block 120 are Eni Vietnam 50% and Neon Energy (Song Hong) Pty. Ltd. and KrisEnergy (Song Hong 105) Ltd. 25% each.

Northwest Territories

MGM Energy Corp., Calgary, said it has surrendered its exploration licenses in Canada's Central Mackenzie Delta region, where the company had been exploring for hydrocarbons in shale formations.

MGM Energy has turned back EL 456, EL 457, EL 458, and EL 459, currently scheduled to expire in January 2016, and consolidated EL 461, which is scheduled to expire in June.

With the surrender, MGM Energy is relieved of its obligation to fulfill its commitments relating to the licenses, including $6.3 million that was due to be paid in June.

In early 2013, MGM Energy reported having spudded the East MacKay I-78 well targeting the Canol shale and Bluefish zone in the Central Mackenzie Valley of Canada's Northwest Territories (OGJ Online, Jan. 28, 2013).

The company said it would drill to 2,050 m on EL 466B and flow test both formations (OGJ Online, Nov. 4, 2011).

Alaska

Miller Energy Resources Inc., Huntsville, Tenn., said its Cook Inlet Energy subsidiary hopes to place the RU-2A well in Alaska on production within several days.

The well is cased to measured total depth of the sidetrack is 15,265 ft, and logs indicate a full column of oil throughout the Hemlock formation at 14,512-15,200 ft MD with permeability, porosity, and resistivity equal to or greater than seen in the original RU-2 well.

Miller Energy said the new bottomhole location is 46 ft higher on structure than the original well, implying the chance for better recovery than the original well. Cumulative production from the original well is 500,000 bbl, and the target at the sidetrack is estimated at 950,000 bbl recoverable.

Meanwhile, Miller Energy expects to spud the Sword-1 well later this month as an extended reach well projected to 19,000 ft MD. Sword-1 targets probable reserves in an adjacent fault block to WMR field and test an upthrown fault closure. Internal 3D seismic shows a faulted four-way closure with a 240-acre structure that contains an estimated recoverable 800,000 bbl of oil.

The company will also soon spud the Olsen Creek-1 well northeast of and on strike with from Three Mile Creek field. Other nearby fields include Beluga River, Lewis River, Pretty Creek, and Lone Creek gas fields, each of which has numerous reservoirs in the objective section. As many as 24 wells could be required to fully develop Olsen Creek, which has multiple prospective zones, Miller Energy said.