Oil Search Ltd. has provided an exploration and development update in its Middle Eastern and African assets for the third quarter.
During the third quarter, a new discovery was made at the Cobra 1A ST3 well in PL190. Gas, together with condensate, was recovered from a 34 metre thick hydrocarbon zone within the upper Hedinia sandstone. Updip potential is confirmed to the NNE by dip meter data, and stratigraphic variations observed between Cobra 1A, ST1, ST2 and ST3 indicate that the Hedinia sandstone has significant potential to improve, both in quality and thickness, in the same direction.
The Cobra 1A ST3 well was suspended as a gas/condensate discovery in early September and Rig 101 has now been demobilised. Importantly, the Cobra discovery represents the first successful test of the sub-thrust, footwall play in PNG and as such has significant implications for prospectivity within PPL 190 and elsewhere in the Fold Belt. In the short term, future activity will focus on completing a detailed technical review of results to determine the best strategy for evaluating the Cobra discovery.
Processing and interpretation of regional seismic data acquired over PDL 2, PPL 219 and PPL 233 during the first half of 2008 took place together with planning for a new Fold Belt acquisition program, scheduled to commence in the first quarter of 2009.
Plans for offshore seismic acquisition were finalized and will be implemented when an outstanding license matter is resolved. It is expected that acquisition will take place in the first quarter of 2009.
During the quarter, acquisition of a 3D seismic survey covering parts of Block 3 (535 square kilometers) and Block 7 (276 square kilometers) was completed with no lost time incidents, on time and on budget. The survey covers an area to the east OMV's Habban Basement discovery in the S2 Block.
Processing of the data is currently underway and the data will be used to define drilling targets for two wells in Block 3 and two wells in Block 7, with the drilling program starting in mid-2009.
The divestment of Oil Search's interests in Blocks 15, 35, 43, 49 and 74 was completed on August 24, 2008.
The divestment of Oil Search's Egyptian assets was completed on August 24, 2008.
Processing of 242 kilometres of 2D data over the Bina Bawi block (OSH 6%) was carried out during the quarter and the processed data was received late in the quarter. This data will be used to map the structure and define possible further well locations, with drilling potentially taking place in 2009.
During the quarter, preparations were carried out in the Shakal block (OSH 15%) for the spud of the Shakal 1 exploration well. Delays were experienced due to logistical problems and with re-starting the rig which had been stacked for a considerable period. The well spudded in early October and is expected to take approximately 60 days to drill. The main targets are Tertiary and Cretaceous carbonates which are productive reservoirs in nearby discoveries. The block is operated by Prime Resources from the US. The Kurdistan Regional Government has requested tight hole (confidential) status for all activities within the Shakal EPSA. In the event of any material developments, Oil Search will provide further information to the market, in line with ASX reporting requirements.
Preparations continued for drilling an exploration well on the Caliph prospect in the Libyan Area 18 EPSA. The Songa Saturn drillship arrived in Libya from previous operations in Ghana in September for the first well in a program of wells which includes Caliph 1. Current estimates now put the spud of the Caliph 1 well in mid-January 2009.
The prospect is considered to be a high risk, high reward feature which has potential reserves in excess of 1 billion barrels of oil equivalent. The well will be drilled by Petrobras. Oil Search holds a 30% interest in the license.
Work began on the Tajerouine exploration permit (OSH 100% Operator) and the adjacent Le Kef exploration permit (OSH 25%, Primoil Operator) during the quarter. Existing data has been collated and a database built and 2D seismic data will be reprocessed for both permits in the fourth quarter. In Le Kef, Primoil has carried out geological fieldwork with the aim of constraining the structures and potential reservoirs present. A similar exercise will be carried out by Oil Search in the Tajerouine permit, beginning in the fourth quarter.
The work program commitments include 400 kilometers of seismic acquisition in Tajerouine and 165 kilometers in Le Kef to be acquired in 2009, with one well in each permit currently scheduled for 2010.
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