Lion Reports Significant Gas Shows at Lofin-2 Well in Indonesia's Seram PSC

Australia's Lion Energy Ltd. reported Wednesday that Lofin-2 appraisal well in Seram (Non-Bula) Production Sharing Contract in eastern Indonesia is currently preparing to cut an 59 foot (18 meter) core to provide important rock data to assist in the evaluation of the well. Only 5.6 foot (1.7 meters) of core, consisting of tight limestone, was recovered in the first coring attempt due to mechanical issues.

The forward plan is to recover the core and continue drilling to the planned TD of 17,798 feet (5,425 meters). This will allow evaluation of the extent of the potential hydrocarbon column and whether an oil leg is present. The well may TD shallower if there are no further indications of hydrocarbons and/or a water contact is penetrated.

The top of the primary objective Manusela Formation limestone was encountered at 15,141 feet (4,615 meters MD/13,993 feet or 4,265 meters TVDSS), some 1,132 feet (345 meters) deeper than the top Manusela Formation in the Lofin-1 discovery well. The potential hydrocarbon column is at least 1,968 feet (600 meters) to current TD, based on preliminary well data while drilling.

The Manusela Formation is described as predominantly limestone, with nil-to-­poor visual porosity. Some mud losses have been recorded while drilling indicating fractures are likely to be present in the interval. High connection gas and trip gas have also been recorded in the well. Overall weak fluorescence shows continue to be recorded in the Manusela.

Lion’s CEO Kim Morrison noted “The gas shows point to a potentially significant gas column in the large Lofin structure. The plan is to continue drilling to evaluate the extent of the potential column and whether an oil leg is present. While the presence of significant gas shows is encouraging we caution it is still too early to reach a conclusion as to the eventual outcome of the well.”

Lofin-2 is located in the Seram (Non Bula) PSC in eastern Indonesia and was spud on October 31. It is being drilled to appraise the Lofin-­1 discovery made in 2012, which flowed 15.7 million standard cubic feet per day (MMscf/d) of gas and 171 barrels per day (bpd) of oil/condensate from the fractured Manusela Formation. The objective of the well is to investigate the extent of the hydrocarbon column below the 525 feet (160 meters) delineated in Lofin-­1 which could not be drilled deeper due to engineering issues.

Lion has a 2.5 percent interest in the Seram (Non Bula) PSC which is operated by CITIC Seram Energy Ltd. (51 percent) with other co-­venturers being KUFPEC (Indonesia) Ltd. (30 percent) and Gulf Petroleum Investment Company (16.5 percent).


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