Kina Petroleum Limited announced Thursday that it will exit exploration license PPL 337 after failing to encounter commercial quantities of hydrocarbons.
Along with its joint venture partner Heritage Oil Ltd, Kina drilled the Raintree-1 and Kwila-1 wells in the license last year. While the wells achieved their objective of testing the existence of a Miocene reef play and a plio/pliostecene sandstone play, they failed to intersect commercial levels of oil and gas and were subsequently plugged and abandoned.
Following the evaluation of drilling results, Kina has concluded that “there is insufficient remaining prospectivity in the license to warrant further exploration work, particularly given the current oil price climate.”
Kina Petroleum’s Managing Director, Richard Schroder, commented in a company statement:
“Last year’s drilling in PPL 337 were a milestone for both the country and the company, however evaluation of the drilling results suggests that the prospects of a commercial discovery in the license is, for the foreseeable future, low.
“Our strategy and areas of focus remain clear, and surrendering the license allows us to optimize our asset portfolio during a period where low oil prices will continue to necessitate step changes throughout the broader industry.”
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