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Home Fossil Energy Oilex Announces Spud of La Rocca Well at WA-388-P, Offshore Australia

Oilex Announces Spud of La Rocca Well at WA-388-P, Offshore Australia

May 9, 2011

 

Oilex Ltd advises that the “Ocean Patriot” rig has arrived at the La Rocca-1 well location and the well was spudded at 3:20 hours (WST) on 30 April 2011.

La Rocca-1 is planned to take approximately 41 days days from spud to reach a final total depth of approximately 5,100 metres.

Permit

The WA-388-P permit is located north of the Pluto, Wheatstone, Gorgon and North West Shelf Project fields, offshore Western Australia. The WA-388-P permit contains a portfolio of play types and seven prospects have been identified ranging in  potential size from 0.3 to 2.8 trillion cubic feet (TCF) of prospective gas resource (recoverable best estimate, 100% basis). Seismic amplitude anomalies evident in the 3D seismic data are likely Direct Hydrocarbon Indicators, suggesting the presence  of gas by analogy with nearby fields and discoveries.

The La Rocca-1 well, the first exploration well in the permit, will drill the La Rocca prospect in the Intra Mungaroo channel zone. The well is operated by Apache Northwest Pty Ltd (“Apache”), which has had extensive success in exploring this play in the outer North West Shelf.

Farm-in

As previously disclosed, Apache entered a farm-in agreement with the WA-388-P Joint Venture in which Apache will earn a 40% interest in the WA-388-P permit by paying 100% of the well and testing costs (up to agreed caps). Under the farm-in agreement Oilex will farm-out 5.6% of its 14% interest to Apache.

An amendment to the farm-in agreement was subsequently concluded in which Oilex sold its 5.6% farm-out interest to Apache for cash consideration equivalent to the value of being carried through the well and testing under the original farm-in agreement. The amendment does not materially alter Oilex’s commercial position under the farm-in agreement. The farm-in agreement and amendment are subject to Government approval.

Participants in the WA-388-P are as follows:

Oilex Ltd  8.4%
Apache Northwest Pty Ltd (Operator)  40%
Sasol Petroleum Australia  Ltd 18%
Videocon Industries Ltd  8.4%
Gujarat State Petroleum Corporation Ltd  8.4%
Bharat PetroResources Limited  8.4%
Hindustan Petroleum Corp. Ltd  8.4%

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Source:Oilex , May 9, 2011; Image: Bounty Oil & Gas