Central Petroleum Starts Amadeus Drilling Campaign
Central Petroleum has spudded the Palm Valley 12 (PV12) well in the OL3 license, Southwest of Alice Springs in Australia’s Northern Territory.
The company said that the well was spud on Sunday, April 17. It is the first of a two-well drilling program that also includes the Dingo-5 exploration and production well.
Central has a 50 percent interest in both PV12 and Dingo-5, which are free-carried for Central by New Zealand Oil & Gas and Cue Energy Resources which hold 35 and 15 percent stakes, respectively. Both wells are scheduled to be completed this year.
The PV12 well has two alternative objectives, consisting of a deeper gas exploration target or a shallower gas appraisal lateral that could become a production well.
The first exploration target is the Arumbera Sandstone at an anticipated vertical depth of 11,680 feet. The well will be drilled to a total vertical depth of 13,060 feet, making it the deepest to be executed in the Amadeus Basin. The target interval is also the gas-producing zone at Central's Dingo gas field, located about 75 miles to the east.
The well will be deviated at up to a 45deg angle in the target zone to increase the exposure to potential formation fractures.
The success of PV12 could, according to Central Petroleum, open a significant new phase of growth within the existing Palm Valley gas field by targeting 123 PJ of mean prospective resource. This is more than four times Palm Valley's existing 2P reserves and would increase Central's total existing 2P reserves base of 75.4 PJ in the Amadeus Basin by 81 percent. The PV12 well is currently estimated to reach the exploration target in early June.
If the PV12 deep exploration objective is unsuccessful, the well will be plugged back and side-tracked to test the shallower Pacoota Sandstone at a depth of 5,800 feet, with the potential to become a production well.
The PV12 appraisal well is designed as a deviated well extending up to 3,280 feet within the Pacoota Sandstone, which is the current producing zone for the existing Palm Valley gas field.
The lateral design is similar to the successful PV13 appraisal well drilled in 2019, which had a lateral extension of only 985 feet and has already produced approximately 5.7 PJs in its first three years of production.
"We have worked hard over the past year to lay the groundwork for the current two-well exploration program and three sub-salt exploration wells next year, giving us a total of 5 exploration wells over the next 18 months. Today's announcement marks our transition into a phase of sustained and material exploration news flow for Central,” said Central's Managing Director and CEO Leon Devaney.
“We are also actively pursuing opportunities to expand this drilling program to include an oil exploration well at Mamlambo and gas appraisal wells in the Mereenie Stairway. As a small-cap, delivering each of these exploration wells provides Central with a distinct opportunity for upward momentum.
“Combined with strong underlying market fundamentals, our pivot into the delivery phase of exploration drilling makes this an exciting time for our shareholders," concluded Devaney.
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