Jadestone’s infill drilling campaign off Malaysia seen as ‘very successful’

AIM-listed and Singapore-headquartered oil and gas player Jadestone Energy has wrapped up the drilling activities at the final well in its infill drilling campaign offshore Peninsular Malaysia.

NAGA 2 rig; Source: Velesto Energy

According to Jadestone Energy, its 2023 East Belumut field drilling campaign offshore Peninsular Malaysia has delivered results significantly ahead of expectations, and the fourth and final well in the drilling program is currently being tested after reaching around 4,600 meters measured depth in the southwest of the field.  

The company explains that this is approximately 730 meters measured depth more than originally planned, due to the better-than-expected oil column encountered at the toe of the well, and the longest reach horizontal well ever drilled in the field. A 1,700-meter horizontal section was drilled in the target formation, aided by optimization of the well trajectory using geo-steering tools. The well is expected to produce at initial rates above 3,500 bbls/d.

Furthermore, Jadestone highlights that the results of the East Belumut infill campaign have far exceeded expectations – which were for initial gross aggregate rates from all four wells of 3,500 bbls/d – when combined with the three wells drilled to date and currently producing at an aggregate gross rate of about 7,000 bbls/d.

The AIM-listed player points out that the drilling capex will be cost recovered with payback expected by 2Q 2024. The well results, which are already being used to update the geological model for the East Belumut field, are anticipated to have a positive impact on reserves and are likely to provide several new infill targets for future drilling campaigns.

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Paul Blakeley, Jadestone’s President and CEO, commented: “The East Belumut drilling program has proved to be very successful, significantly exceeding our pre-drill expectations and testament to the hard work and enthusiasm of the many people across the business involved in this campaign. This is our core strategy at work, having acquired the interests in 2021 and now starting to add value through our differentiated view of the subsurface potential.  

“These results will significantly expand the scope for further infill drilling on East Belumut and I expect will generate a number of well campaigns for the future. Production performance across the portfolio has been solid recently, underpinned by strong performance in Malaysia and stabilization of production at Montara. We will continue to work hard to make this ‘business as usual’ in the future.”

Since April 2023, the overall production has averaged approximately 14,900 boe/d, equivalent to an average of around 13,500 boe/d year-to-date. The production is now expected to be towards the upper end of the April to December 2023 guidance range of 13,500 – 15,000 boe/d. This incorporates a planned shutdown for one week at Montara in early December for compressor maintenance.

Back in August 2023, Jadestone took Velesto’s NAGA 2 jack-up drilling rig on contract, after it hired the rig for the East Belumut infill drilling campaign. The East Belumut field is located in the PM 323 production sharing contract, which also contains the Chermingat and West Belumut fields. These fields have been developed with a wellhead platform connected to a central processing platform at the East Belumut field.