Leed Petroleum PLC announced the successful drilling of the primary target zone on the Eugene Island A-6 well. Initial results of the well exceed the company's expectations and provide the potential for reserves upgrades.
Eugene Island A-6 development well was spudded on Sept. 16, 2007, and the company has successfully sidetracked and run casing in the wellbore to a depth of 15,335 feet, which is 120 feet below the primary target sand. Logging of this section of the wellbore has been performed, and the log results confirm that the primary target sand has 56 feet of net true vertical thickness pay.
Analysis of the logs indicates that the objective sand is thicker and of higher quality than the Company had expected prior to drilling. At the time of admission to AIM, the competent person, an independent reservoir engineering firm, credited the primary zone with 2P* reserves of 824 thousand barrels of oil and 4.8 billion cubic feet of gas. Based on the Company's evaluation of the logs, the Company's internal post-drill reserve estimate for the primary zone exceeds this by one third. Moreover, the Company believes that after the well has produced for a short time the Company's independent reserve auditor will move a substantial portion of the pre-drill estimated 2P* reserves into the 1P* category.
The Company is currently preparing to drill ahead to penetrate additional exploratory zones. On completion of the additional exploratory drilling, Leed intends to carry out production tests to determine flow rates for the Eugene Island A-6 development well. Refurbishment of existing facilities to accommodate production from the A-6 well has already commenced, and the Company expects to begin producing hydrocarbons from this well very shortly after the well is completed.
The Eugene Island Blocks are located 50 miles offshore, south of Morgan City, Louisiana, in the Gulf of Mexico, in approximately 80 feet of water. Leed's management team has built an inventory of development projects and exploration targets across the Eugene Island Block 183/184 field.
"Although this well has taken quite a bit longer to drill than we had planned originally, we are delighted to have casing across the primary objective, the quality of which significantly exceeds our expectations," Howard Wilson, president and chief executive of Leed, commented. "We eagerly await testing the highly prospective deeper objectives in this well and commencement of production from the wellbore in the near future."
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