Niko Receives India's Offshore Block D6's MJ Discovery Resources Report
Niko Resources Ltd. (Niko or the Company) announced Monday that the Company has received an independent resources evaluation report for the MJ Discovery in the D6 Block in India from Deloitte LLP (Deloitte), an independent petroleum engineering firm. The evaluation has been prepared in accordance with National Instrument 51‐101 ‐ Standards of Disclosure for Oil and Gas Activities and the Canadian Oil and Gas Evaluation Handbook, with an effective date of March 31.
“The discovery and successful appraisal of MJ adds a new and exciting chapter to the D6 Block. Going forward, the contractor group in the block will be working on plans to develop MJ, which may lead to potentially significant additions to reserves and production levels in the coming years,” said William T. Hornaday, chief operating officer, Niko Resources Ltd.
Resources Evaluation – MJ Discovery in the D6 Block in India
Deloitte has evaluated the contingent resources for the MJ Discovery in the D6 Block in India based on available information, including the drilling, testing and coring results of the MJ‐1 discovery well and the MJ‐A1, MJ‐A2, and MJA3 appraisal wells:
- The drilling of MJ‐1, located in the Central (North) fault block, was completed in May 2013 in a water depth of 3,359 feet (1,024 meters) to a total depth of 14,793 feet (4,509 meters) to explore the prospectivity of a Mesozoic Synrift Clastic reservoir lying over 6,561 feet (2,000 meters) below the already producing reservoirs in the Dhirubhai 1 and 3 gas fields. Formation evaluation indicates a gross gas and condensate column in the well of about 508 feet (155 meters) in the Mesozoic reservoirs. In a drill stem test, the well flowed 30.6 million cubic feet per day (MMcf/d) of natural gas and 2,121 barrels per day of liquids though a 36/64 inch choke, with a flowing bottom hole pressure of 8,461 psia suggesting good flow potential. The well flow rate during the test was limited by the rig and well test equipment configuration
- The appraisal program, which included three appraisal wells, has provided additional information on understanding the reservoir. The first appraisal well, MJ‐A1, in what is now designated as the Northern fault block, had encouraging results. No hydrocarbon bearing zone was encountered in the second appraisal well, MJ‐A2, in the Eastern segment of MJ discovery area. The third appraisal well, MJ‐A3, in the Central (South) fault block, encountered hydrocarbons at the zone of interest, with the zone thinner than expected
Deloitte’s best case estimate of gross unrisked contingent resources of 1.4 trillion cubic feet of equivalent (Tcfe) relates to the Central (North), Northern and Central (South) fault blocks that were drilled by the MJ‐1, MJ‐A1, and MJ‐A3 wells, based on an estimated areal extent of approximately 9.2 square miles (24 square kilometers), approximately twice the areal extent of the analogous MA field that is currently producing.
Table 1 provides the estimates of the gross unrisked recoverable contingent resources for the MJ Discovery in the D6 Block in India as evaluated by Deloitte as of March 31.
Table 1: Gross Unrisked Contingent Resources for the MJ Discovery in the KG-D6 Block in India as of March 31
- Non Associated Gas (billion cubic feet): Low Estimate - 778; Best Estimate - 1,108; High Estimate - 1,581
- Condensate (million barrels): Low Estimate - 34; Best Estimate - 49; High Estimate - 71
- Total (billion cubic feet equivalent): Low Estimate - 988; Best Estimate - 1,402; High Estimate - 2,000
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