Buccaneer provided the following final flow testing results from its 100% owned Kenai Loop # 1 well.
A flow test over 4 different choke sizes, a 4 point test, has been successfully completed. This test includes the measurement of pressures which allows for the calculation of the AOFP. The AOFP estimates the well's flow rate without a choke.
The AOFP was calculated as 33.2 million cubic feet per day (MMCFD) which is significantly higher than the expectations. The high AOFP demonstrates the excellent permeability and porosity of the 2 zones perforated and tested.
The long term deliverable production rate from the well has been estimated as 6 - 8 MMCFD (750 - 1000 BOEPD). This steady deliverable production rate is anticipated for approximately 2 years and will facilitate a favorable gas sales contract.
Based on the average production rate of 7.0 MMCFD and the expected floor price of gas in south central Alaska of US $7.00 / MCF this would result in net revenue to the Company of approximately US $1.05 million per month (US $12.6 million per annum). The gas price in
Net revenue is after all royalties, production taxes and expected normal operational costs and amount to ~US $2.00 / MCF. Fixed royalties account for approximately 65% of these costs. An upside potential exists in the area from the remaining 14 zones (423' of gross pay) that have not yet been tested. Buccaneer's contiguous block in the area is in excess of 8,900 acres. An internal estimate of recoverable reserves is currently being finalized after which the Company will engage a third party engineer to complete a reserve report.
Kenai Loop Development Program
The Company is in the process of finalizing a development program for the Kenai Loop project which will include:
Kenai Loop # 1 Previous Results
In the initial phase of the testing program, the Kenai Loop # 1 has successfully tested gas to the surface at a rate of 10 million cubic feet per day on a 20/64" choke with a FTP (flowing tubing pressure) of 3,495 psi.
The Company has up to 16 zones totaling 510' of gross pay identified by logs as test candidates in the Beluga and Upper Tyonek Formations. As the rig needed to be released back to Marathon on June 1, 2011, 2 of the 3 high graded zones in the Upper Tyonek
The 2 zones total 87' of gross pay were described as follows:
Zone 1 has an upper sand of 37' of gross pay which logs have confirmed as being quality reservoir with high porosity and good permeability. This upper sand package had a "gas kick" during drilling operations. There is an additional 12' of lower sand which is a lesser quality sand, but remains attractive. Only the upper portion of this zone is included in the testing program.
Zone 2 is an additional massive sandstone zone of approximately 50' of gross pay which logs indicate has good porosity and permeability.
Depending on rig availability a second well is planned for the third quarter 2011. The Company is in the progress of formulating a development program for the field, including a production schedule, beyond the initially anticipated 2-3 wells.
The closest wells to the Company's Kenai Loop # 1 well are the Cannery Loop #3 and #4 wells located in the Cannery Loop Field, which were drilled from the same surface location approximately 6,325 feet (1.2 miles) from the Kenai Loop # 1 well location. The Cannery Loop # 3 and # 4 wells have produced a combined 25.5 BCF (3.18 MMBOE) from pay zones whose equivalents are expected to be present in the Kenai Loop # 1 well, but separated from the Cannery Loop Field by geological deposition rather than fault. Drilling to date in the Kenai Loop # 1 well has confirmed that the formations encountered to date are likely separated from the Field.
There were 11 wells in the adjacent Cannery Loop Field which produced 175 BCF (21.9 MMBOE) One well produced from the Sterling Formation which is not one a target in Kenai Loop # 1 well, the other 10 wells produced from the Beluga and Upper Tyonek. The Upper
Most Popular Articles
From the Career Center
Jobs that may interest you