FAR sees Gambian well costs go up after issue with fluid losses

Australia’s FAR Ltd has temporarily stopped drilling the Bambo-1 well located off The Gambia after experiencing significant fluid losses, which will result in additional time and cost to complete than previously expected.

FAR started drilling the Bambo-1 exploration well in Block A2, using the Stena IceMax drillship, in mid-November 2021. FAR is the operator with a 50 per cent working interest in the A2 and A5 blocks, while its joint venture partner, PC Gambia – a subsidiary of Petronas – holds the remaining 50 per cent interest in these blocks.

As informed by FAR on Monday, the Bambo-1 well has drilled 3216m MDBRT (measured depth below the rotary table) of a total planned depth of 3450m MDBRT. Oil indications have been detected in rock cuttings and hydrocarbons have been interpreted across several intervals in the well from LWD data (logging whilst drilling). Further wireline logging needs to be completed to confirm the finding.

However, drilling operations were temporarily halted at the current depth after significant fluid losses were experienced. These fluid losses were stabilised in accordance with standard offshore operating procedures and FAR is now planning to plug and side-track the well to continue drilling to the planned total depth. Prior to side-tracking and provided hole conditions remain stable, FAR is undertaking a wireline logging program in the current wellbore.

According to an estimate by FAR, the cost to complete the well went up from a total of $51.4 million to $61.27 million, an increase of $9.87 million or $4.935 million net to FAR. The company forecasts a cash balance of $37 million after the completion of the well, inclusive of the increase in Bambo-1 well costs.

Furthermore, the addition of the side-track program has extended the period of operations which is now expected to be completed by the end of December 2021. The drilling was previously expected to take about 30 days.

FAR reiterated that the well has been designated a “tight hole” by FAR and JV partner Petronas and as such, no information related to depth or formation is likely to be provided during the drilling beyond what is required to meet ASX continuous disclosure obligations.

FAR’s Managing Director, Cath Norman, said: “FAR is pleased with the experienced drilling team and contractors who have acted to quickly manage and adjust the Bambo-1 drilling program to suit the geological setting and best meet the objectives of the drilling program.

“FAR is well placed to achieve these objectives through the side-tracked well and in particular drilling through the as yet undrilled Soloo Deep prospect. We are encouraged by the presence of oil in potential reservoirs and look forward to completing the well in the coming weeks.”