Tap Oil Limited’s board has approved Tap’s participation in the Sri Trang-1 exploration well in the Reservation Area of the G1/48 Concession in the Northern Gulf of Thailand.
Mubadala Petroleum, operator of the G1/48 Reservation Area Concession, expects drilling to commence at Sri Trang-1 in mid-May. The well objective is to evaluate the primary Middle Miocene lacustrine sands target with secondary targets of Late Miocene fluvial sands. A valid test of the primary objective Middle Miocene sands is “essential”, according to Tap, as it will “validate the hydrocarbon prospectivity of the Northern Kra basin and de-risk dependent prospects immediately to the West of Sri Trang-1”.
The well will be be drilled in shallow water to approximately 8,497 feet and is expected to take ten days to complete. The outcome of the well will determine the development scenario. Tap’s share of the expected well cost is $1.02 million. Providing the well comes in on budget, Tap will not be required to contribute any further cash for the well.
In addition to confirming its participation on the Sri Trang-1 exploration well, Tap revealed that it has executed an amended facility agreement with BNP Paribas and Siam Commercial Bank (BNP Facility).
The current outstanding balance of the BNP Facility is $25 million. At current oil prices, Tap expects the outstanding balance of the BNP Facility at December 31 to be $9 million and the cash position to be approximately $7 million.
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