Australia's Ambassador Oil and Gas could be on track to strike oil in its first exploration program.
The company said Monday that the onshore Shocking-1 well, the first of two wells to be drilled in the Cooper Basin, encountered good oil shows.
Ambassador and its partner, Australia's Senex Energy, are now preparing to carry out a drill stem test to acquire the oil shows in the first primary target, the McKinlay Formation.
Shocking-1 is sited 1.3 miles (two kilometers) north of operator Senex's producing Vintage Crop-1 well in permit PEL 516 Shocking Block. Due to the well's proximity to Senex, it could be quickly commercialized in the event of a success.
The rig used to spud the Shocking-1 well is Century Rig 3, which will target mean recoverable reserves of about 250,000 barrels of oil.
"The Shocking structure is mapped as having an upside recoverable oil potential in excess of 500,000 barrels," Ambassador said on June 22, 2012.
Under the terms of an earlier farm-in agreement signed between the two companies, Ambassador will fully fund drilling costs to earn a 60 percent stake in each successful prospect. The remaining 40 percent stake is held by Senex.
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