Central Petroleum, Santos advance Dukas exploration program
Central Petroleum Ltd. and JV partner Santos Ltd. have reached agreement on a plan to evaluate the prospective Dukas structure in permit EP112 in the Amadeus basin of the Northern Territory.
Under the plan, the JV will assess options and costs to intersect the target formation that was not reached in the original Dukas-1 wildcat in August 2019.
That well was suspended at a depth of 3,704 m after encountering an exceptionally over-pressured zone above the target reservoir, but not before mud gas samples had indicated a combination of hydrocarbons and inert gases. The JV said these are positive indications for a working petroleum system at the Dukas location.
Prior to drilling Dukas-1, the JV had to rely solely on seismic imaging through a thick section of evaporates and complex thrust faulting to map the structure. Now, much greater detail is available from the recently acquired Dukas-1 well log data.
The JV said the revised structural closure is seen as greater than 400 sq km and the revised mapping has created an opportunity to drill a more crestal well.
The JV is considering three options, all using specialised high-pressure equipment:
- Re-entry of the suspended Dukas-1 well and continue drilling into the formation, a move that will be limited to operations possible within existing casing sizes;
- Twinning Dukas-1 by drilling a new well immediately adjacent to it using new casing to improve drilling and testing opportunities;
- Drilling a new well at a more crestal location.
The JV is working toward a decision by yearend and spudding of the well during first-half 2022.
As part of the new plan, the companies have agreed to an equity split of EP112 of Santos 70% and Central Petroleum 30%.
Santos can elect, prior to the end of July 2021, to carry Central for the first $3 million (Aus.) of its well costs in return for 30% equity in adjacent permit EP82 (excluding the Orange prospect which Central holds 100%).
If the transfer occurs, Santos will pay Central back-costs associated with the transferred interest for field activities conducted in EP82 from the date of the agreement.
If Santos elects not to carry Central in the Dukas well, the equity in EP 112 will revert to Santos 55% and Central 55%.
In either case, Central said that it would like to take the opportunity of the Dukas drilling schedule to accelerate exploration in its 100%-owned permit EP115 to the north where it has other large sub-salt targets. The company said it could use the Dukas rig for drilling in EP115 and save mobilization costs as well as leverage the new Dukas-1 technical data to help firm a well location.