Gas2Grid will earn 40% interest in the onshore section of PEP 38 260 by funding the first A$1.2 million (US$1 million) of the cost of the Kate-1 well (and its pro-rata share of any cost over A$1.2 million) following the signing of a farm-in agreement with Green Gate, the current 100% holder of the exploration permit.
Gas2Grid said it is currently evaluating rig availability with a view to drilling within a three to four month timeframe.
To fund the drilling, the company is completing capital rising of up to A$3 million through a combination of a private share placement and a shareholders share purchase plan. Gas2Grid was formed in 2004 to explore for oil and gas in the Philippines.
The Kate-1 well will test an anticlinal structure, which has prominent surface expression as well as seismic evidence of sub-surface closures in the approximately 1,050 meter-thick sedimentary sections.
The primary target is a sandstone reservoir in the Late Cretaceous Broken River Formation coal measures (450-1050 meters), with secondary targets in younger sandstones and limestones. The structure as mapped has the potential to contain 25 million barrels of oil in place in the Broken River formation.
An oil seep was uncovered during geotechnical works on the flank of the anticline in 2003, and soil gas surveys have confirmed the presence of thermogenic hydrocarbons in the vicinity of the mapped structure.
Meanwhile an energy investment company Widespread Energy, which is listed on the New Zealand Stock Exchange, has announced it has acquired a 10% interest in Green Gate Ltd.
Chris Castle, a director of Widespread Energy said Green Gate has built up a promising portfolio of three petroleum exploration permits in North Canterbury and the Murchison area of the South Island. Green Gate has acquired almost 500 kilometers of seismic data in offshore North Canterbury.
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