Following initial gas shows at 7,800 feet and oil staining appearing at 8,270 feet, material levels of hydrocarbons occurred at 8,497 feet. This was accompanied by a drilling break and a controlled gas kick with oil shows at surface. A second major drilling break and controlled gas kick resulted in a gas and oil inflow with measurable oil entrained within the mud system and pooling in the mud tanks. The well is currently at 8,699 feet.
Original expectations were that the well would TD at 8,500 feet. Current plans are to drill to approximately 9,200 feet or until the well ceases to encounter hydrocarbons. The oil seen so far appears to be of a high quality. As with other fields in Guatemala, H2S is present.
A review of existing older wells in this area has indicated major formation damage in these wells and, as a result, Taghmen is using a balanced drilling technique to ensure minimum losses to the pay zone, where possible.
Following the cessation of drilling, the well will be logged and tested to confirm commerciality. On confirmation of commerciality the Group estimates first production could come on stream within a matter of weeks given that storage facilities and pipeline access and trucking facilities are already established at the Las Casas area.
On completion of the 3X well, the Company plans to sidetrack the 1X well, following encouraging results from the work-over of the well earlier this year.
On 19 September, Taghmen announced it had been awarded a 25-year contract on License A7-2005 covering the Tortugas/Atzam Block in Guatemala.
Nicholas Gay, President and CEO of Taghmen Energy Plc:
"These results are exceptionally promising and could lead to early production this year giving Taghmen a material revenue stream at a time of high oil prices.
With the imminent side track of the 1X well, combined with our planned seismic program aimed at confirming additional drillable prospects, we are confident our exploration program on the Las Casas License will lead to further success."
Greg Smith, Executive Chairman of Taghmen Energy Plc commented:
"This discovery highlights the Group's rationale in choosing Guatemala as its initial location within Latin America to build a material oil and gas business through exploration and exploitation given Guatemala is a highly prospective oil and gas region which has been under explored to date."
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