Australia: Tap Looking Forward to Commencing the High-impact Zola-1 Well

Tap Oil Limited (“Tap”) is pleased to advise that the Operator of WA-290-P, Apache Northwest Pty Ltd (“Apache”) has advised that the Stena Clyde semi-submersible drilling rig is currently running anchors at the Zola-1 drilling location and the well is expected to spud in the next 24 hours.

Once commenced, drilling of Zola-1 is planned to take approximately 40-50 days to reach to a final total depth of around 5,000 metres.

Tap Comment

Tap’s Managing Director and CEO, Peter Stickland said that Tap is looking forward to commencing the high-impact Zola-1 well.

“Zola is a very large, moderate risk prospect and if successful could deliver a resource several times larger than Tap Oil’s current 2P reserves,” Mr Stickland said.

Background

WA-290-P is a 482 km2 exploration permit located in the offshore Carnarvon Basin. The permit is immediately south of the giant Gorgon gas field and west of the Woollybutt oil field (Tap 15%) and contains the Zola prospect.

The Zola prospect is a very large Triassic tilted fault block on trend with the giant Gorgon gas field. One of the largest undrilled structural features in the Carnarvon Basin, Zola is covered by high quality newly reprocessed 3D seismic data and is considered a moderate risk prospect. Zola is estimated by Tap to contain mean recoverable gas volumes of 1.0 trillion cubic feet with upside potential for 2.0 trillion cubic feet. The well will test the gas potential of several top and intra Mungaroo Formation sands – the primary reservoir at Gorgon. In addition it is possible that some Jurassic reservoirs may be developed flanking the main Triassic structure. The primary Mungaroo Formation target will be intersected at approximately 4,300 metres below sea level. Water depth at the well location is approximately 280 metres.

Previous drilling in the block focused on the shallower Jurassic and Cretaceous interval, resulting in the Antiope gas discovery in 2000 and the minor Lauda oil discovery in 2005.

Located close to existing and developing gas infrastructure, Zola would have multiple potential development options should it be a discovery. Any development at Zola could also encompass the overlying Antiope gas discovery (estimated at ~120 Bcf).

Earlier this year Tap entered into an agreement with Apache to farmout a 10% interest in WA-290-P in consideration for Apache paying a promoted share of the costs of the Zola-1 well. Tap retains a 10% interest in the permit.

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Source: Tap Oil, November 30, 2010;