Mosman Oil and Gas Limited, the New Zealand and Australia focused oil exploration and development company, provided Thursday a corporate update and announce that it is accelerating its drilling program on its Murchison permit in New Zealand. The Company has also raised $746,000 (GBP 500,000) by way of a placing and subscription of 10,000,000 new ordinary shares in the capital of the Company (New Ordinary Shares) at $7.46 or GBP 5 per share (AUD 9.75 per share) by SP Angel Corporate Finance LLP (the Placing).
Accelerated Drilling Program at Murchison
At the Murchison permit in New Zealand, the potential for hydrocarbon resources has been reinforced by recent additional technical work conducted by the Company's technical team. Mosman has now engaged SRK Consulting (Australasia) Pty Ltd. to independently review the project and opine on the potential resource number to quantify this target. Planning has commenced on all aspects of drilling and approvals will be sought from the landowners and relevant authorities once the final well location is selected. Commencement of site work and drilling the first well is scheduled for mid-2015.
Petroleum Creek - New Zealand
As announced previously the Company has perforated the top of the Cobden Limestone zone at a depth of 794-804 feet (242-245 meters), recompleted the well, and re-installed the downhole pump. The nodding donkey was installed March 2 ready for flow testing.
Flow testing started shortly thereafter and the testing was planned to continue for approximately 60 days.
It is early days in the well testing program and pumping has been deliberately conducted at intentionally low levels. Pumping has occurred on 15 days so far but, due to HSE reasons, pumping of the well has only occurred in daylight hours. Approximately 120 barrels of fluid has been pumped to surface to date and fluids recovered so far have been both oil and water. Although predominantly water, the Company believe this to be largely recovered drilling fluid as several hundred barrels of water based drilling fluid was "lost" in to the hole when drilled.
The next phase of well testing is intended to determine maximum reservoir flow and definitive reservoir fluid composition (oil and/or water) so pump rates will be increased in the next phase of flow testing scheduled to commence after Easter.
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