Australia: Armour Energy Provides Egilabria 2 Well Update

Armour Energy announced that the drilling of the Egilabria 2 DW1 lateral appraisal well has commenced from the Egilabria 2 vertical well at a depth of approximately 1300 metres.

The Egilabria 2 DW1 lateral well is planning to target a range of possible trajectories based on drilling that will result in between 570 and 750 metres of lateral length and estabilishing a fracture stimulation interval from1605‐1745metres.

Egilabria 2 vertical well penetrated the bottom of the target Lawn Shale at 1810 metres, 65 metres lower than forecast, confirming a highly prospective Lawn Shale target interval on logs of 137 metres, approximately 12 metres thicker than the 125 metres expected. Gas has been detected over a length in excess of 800 metres from the approximate interval of 1091 metres to 1900 metres, and a number of flares were encountered.

Armour considers these results to be very encouraging, and the extensive log data supports the case for the lateral and fracture stimulation planned for the Egilabria 2 DW1 well. Meanwhile Armour is continuing to analyse the data and are evaluating designs of up to eight fracture stimulation stages to optimise productivity from the Egilabria 2 DW1 lateral. Final number of stages and treatment sizes will be based on the final trajectory of the lateral and a full log suite.

Halliburton Energy Services has been contracted to carry out the hydraulic stimulation of the Egilabria 2 DW1 well in August and is a proven service provider in other Australian shale plays. The planned hydraulic stimulation of the Egilabria 2 DW1 lateral well is designed to prove commercial gas flows and will be a key milestone in the Company’s plans to define proven and probable reserves in ATP 1087.