AWE Limited reports that, based on the significant additional work required to mitigate the mechanical difficulties and drill the two sidetracks at Pateke-4H development well, gross pre-completion well costs have increased.
The well costs have increased beyond the pre-drilling estimate of USD 55 million (AWE share 32 million). The revised estimated gross pre-completion well cost is USD 99 million (AWE share USD 57 million) with completion costs estimated at USD 12 million gross.
As at 06:00 hours (6.00am NZDT) today Pateke-4H development well was at a total measured depth of 4,772m, including a 749m horizontal section through the reservoir.
The total depth was revised from the original 5,381m target due to the high quality of the reservoir encountered and to ensure a stable well bore was achieved for effective completion and production.
The oil-bearing properties of the Kapuni F10 reservoir are positive. Further analysis is required to determine the expected recovery from Pateke-4H, but initial evaluation suggests a resource range consistent with the pre-drill estimate of approximately 2.5 million barrels gross.
[mappress]
May 06, 2014