The directors of 3D Oil Ltd are pleased to announce a major upgrade to its reserves and contingent resources. Since completing drilling at its 100% owned West Seahorse field in the Gippsland Basin last year, 3D Oil has undertaken a comprehensive evaluation of the field's sub surface to provide a further rigorous reserves assessment. The revised evaluation provides an update and an increase to the reserves provided in August 2008 and flows from a continuous process which has occurred since that time.
Commenting on the upgrade, 3D Oil's managing director, Noel Newell said, "It is very pleasing to announce a material upgrade to our reserves and contingent resources. A combined 2P reserves and best estimate contingent resource (P50) of 8.7 million barrels of recoverable oil is now interpreted to exist at West Seahorse. A particularly positive aspect of today's reserves upgrade is the 32% increase in 1P reserves and a 14% increase in 2P reserves. The substantial upgrade highlights the inherent value in West Seahorse and bodes well for 3D Oil. 3D Oil is actively reviewing options to develop West Seahorse, including seeking an appropriate joint venture partner."
The sub surface evaluation was undertaken using independent expert consultants and utilising the new drilling data. This information has been incorporated with the existing 3D seismic data to generate a new volumetric evaluation of the hydrocarbons in West Seahorse. The work carried out included detailed reservoir analysis; detailed mapping of all hydrocarbon bearing horizons; high density depth conversion; reservoir fluid analysis; reservoir simulation and production forecasting and reserve assessment.
West Seahorse contains three separate oil zones: the N1 (Top Latrobe), the N2.6 and the P1 (both intra Latrobe) formations. Reservoir analysis has confirmed the excellent quality of the reservoir units. All consist of thick, stacked fluvial channel sandstones and are expected to provide the high flow rates, supplemented by strong water drive, typical of the Gippsland Basin Latrobe Group reservoirs. Both the N1 and N2.6 zones currently produce commercial volumes of oil in the neighbouring Seahorse field, operated by the joint venture of Esso Australia Resources and BHP Billiton Gippsland Basin.
3D Oil Limited acquired a 100% interest in the Gippsland Basin permit Vic/P57 in April, 2004, which contains the West Seahorse oil field as well as significant oil exploration opportunities. The company has also acquired a 100% interest in the lightly explored Bass Basin permit T41-P.
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