March Resources Corp. provided an update on the results of the upper section of the Pica #1 well in Chile drilled to date. March previously spud the well on January 21, 2008 and is continuing to drill it to a total depth ("TD") of approximately 3,300 metres. March is presently drilling at approximately 2,650 metres depth. The drilling operation to date has gone extremely well, although the drilling has been slower than originally anticipated.
The zones drilled through to date in Pica #1 have encountered a total of approximately 500 meters of gas charged volcanic tuff and sand intervals. These intervals were sampled during drilling with definite and significant increases in background gas readings on the mud/gas log. In addition, several controlled gas kicks have been observed at surface during drilling breaks, in what is anticipated to be fractured rock. The samples taken from a depth of 900 meters to approximately 1,550 metres have had mud gas isotope analyses conducted on them in an independent lab in North America. The Hydrocarbon Gas Composition results indicate that the gases sampled to date have a high percentage of methane but also include varying percentages of ethane, propane and traces of condensate.
Drill cutting samples indicate that these zones consist of varying amounts of volcanic tuff and orthoquartzite, tight volcanic sands that appear to have varying fracture concentrations at various depths. This type of volcanic sand has shown very strong production results in other areas of the world, as it typically responds favourably to mechanical fracturing. Results to date are considered to be very favourable and have convinced March that completion of some of these zones immediately following completion of drilling operations is warranted.
The zones will likely require fracture stimulation prior to additional testing being conducted to fully determine stabilized production rates and potential recoveries are possible. The results noted are contingent upon continued success with the drilling and testing operation and do not represent the discovery of reserves of any nature. If discovered, there is no certainty at this time that any discovery will be technically or economically viable to produce.
It should be noted that the main gas targets in the well have not yet been reached. They are expected to be encountered from approximately 2,800 metres through to TD, which is currently projected to be at approximately 3,300 meters. It is anticipated that the well will reach TD in the 7 to 10 days. The main target in this well is comprised of a thrust zone, which cuts vertically through any existing black shales in the hanging wall or the footwall of this structure. The black shales are considered to be the source rock in this basin. The surface expression of this thrust has a north-south extension of approximately 30 kilometers, which was seen in the original 2D seismic lines previously shot.
This is the type of structure that exists in the over-thrust belts of Canada and Montana/Wyoming, as well as the known structural formations in the Neuquen Basin of Argentina and the Llanos Basin of Colombia.
Once TD is reached, March intends to log the well and identify the additional prospective zones to be completed and tested from logs, isotube samples, gas readings and drill cutting samples. The results of the logging and testing will be released as they become available.
March intends to complete Pica #1 and move immediately to the drilling of Pica #2. The well site construction for Pica # 2 has been completed and March anticipates that Pica #2 will spud within 7 days of the completion of Pica #1. March has also begun preliminary work to drill a third well in the Pica North Block. March has a 100% interest in both the Pica North and Pica South Blocks.
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