ENP Newswire -
Release date- 17072014 -
As outlined in the
The Company is well positioned for exploration success in the near term with the drilling of the Phoenix South-1 well and we recently announced the next platform for growth with Carnarvon being successfully granted new exploration blocks on the North West Shelf. We have a clear strategy to convert this success into value for our shareholders whilst endeavouring to minimise the financial, operational and exploration risks as much as possible.
During the quarter we commenced the second drilling program in
The news this month that we needed to side-track the Phoenix South-1 well, to bypass casing equipment stuck in the well bore, was unfortunate but has been dealt with, with drilling recommencing on
During the quarter we also announced the award of three new contiguous exploration blocks in the
I look forward to providing shareholders with further progress reports in the coming months on drilling and other business activities via our ASX releases and in my CEO Newsletters. The later are available on our website and can be received in future by entering an email address in the 'email subscription' section on the home page of our website.
WA-435-P and WA-437-P permits (Carnarvon 20%, Finder Exploration 20%, JX Nippon 20%, Apache 40% and Operator) The Phoenix South-1 well commenced drilling in the WA-435-P permit on
The Phoenix South-1 well is planned to drill to a depth of approximately 4,500 meters to explore for gas on trend with that discovered in the
The well will be funded to
Success in the Phoenix South-1 well is likely to lead the Joint Venture to drill the Roc well in the adjoining WA-437-P permit. This is a similarly large structure identified on modern 3D seismic data and is the next structure up from Phoenix South. Funding for this well has been secured through an agreement with Apache and JX Nippon. Carnarvon will retain a 20% interest in both permits if both wells are drilled.
WA-436-P and WA-438-P permits
Apache holds an option to acquire a 40% interest and operatorship in WA-436-P and WA-438-P, with 20% provided by Carnarvon and 20% by Finder. Upon Apache exercising the option, Carnarvon will hold a 30% interest in each of WA-436-P and WA-438-P. The option expires on
The objective of the agreement was to draw forward value to the Phoenix South-1 well and Roc-1 well (contingent) and, on exercise of the option, secure a world class operator in Apache for these permits. During the quarter the National Offshore Petroleum Titles Administrator approved a variation of the Permit Year 6 work program for WA-436-P enabling the operator to licence 400km2 of the Zeester 3D seismic data and undertake further technical work and studies in lieu of drilling a well.
WA-443-P and WA-399-P permit
Carnarvon was granted approval to withdraw from the permits during the quarter.
EP-490-P and TP/27 and EP-491-P permit
During the Quarter, Carnarvon announced the award of three contiguous blocks on the eastern flank of the prolific oil producing Barrow Sub basin, namely Petroleum Exploration Permit EP-490, TP/27 and EP-491.
Carnarvon is Operator and 100% working interest holder in these blocks that cover a total area of around 3,200 km2.
Two major hydrocarbon accumulations occur immediately to the north of these blocks. The Wandoo Oilfield is located approximately 46kms to the north of these blocks with its primary reservoir at a depth of approximately 600 metres in the Early Cretaceous M.australis Sandstone.
Recoverable oil is estimated to be approximately 100 million barrels. The Stag Oilfield is located only 24 kms to the north of these blocks with its primary reservoir at a depth of approximately 700 metres. Recoverable oil is estimated to be around 50 million barrels. Both fields lie in approximately 50 metres of water.
These new blocks are substantially covered by existing modern 3D seismic data that will aid in identifying analogous traps to the Stag and Wandoo oilfields. Numerous oil and gas fields have also been discovered throughout the area to the west of the blocks, including the significant hydrocarbon accumulations in the Harriet area that produces from the highly prolific Flag Sandstone.
Water depth over the blocks does not exceed 70m, which when combined with shallow target depths, allows for cost effective drilling using offshore jack-up rigs. Work commitments for the primary 3 year period entail reprocessing the existing 3D seismic and geological studies and will not add any significant cost exposure to Carnarvon's already low future commitments.
During the Quarter, the sale of half of Carnarvon's 40% interest in L33/43, L44/43 and SW1A Concessions to
The overall success of the first drilling campaign in the 2014 calendar year resulted in an increase in gross oil production rates to approximately 4,000 bopd. No drilling was undertaken for the period from early
Operations remain unaffected by recent political activities in
The L33-5A well was an unsuccessful exploration well drilled to test the igneous reservoir in the area to the west and outside of the existing production license.
The WBEXT-5A well was a successful exploration well that intersected several sandstones to the east of the current WBEXT production area. The well was put on test with initial rates around 80-100 bopd with no water. Based on the success of this well, the Operator sought an extension to the WBEXT production license area during the Quarter. In the interim, the WBEXT-5A well will be shut-in having come to the end of the Government allowed 90 day production test period.
The WBEXT-3D well was completed and placed on production during the Quarter. The well is a deviated development/appraisal well located in the WBEXT production area, to the north of the Wichian Buri Field. Initial testing was successful with the well capable of flowing at rates up to 3,500 bopd. To reduce the chance of early water incursion the oil flow rate has been deliberately reduced.
Water injection project
At Quarter end the water injection well was shut-in to monitor the affect on the producing wells. It is anticipated that water injection will restart in late
L52/50 & L53/50 Concessions
During the previous quarter the Company advised the
Corporate / Financial
The Company's cash holdings at the end of the Quarter were
Net revenue for the quarter was
The company also received net proceeds of
Carnarvon is focused on oil & gas exploration in the world-class province of the North West Shelf area off the coast of
Tel: (+618) 9321 2665
Professional Public Relations
Tel: (+618) 9388 0944
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