AWE Trims Yolla Field Reserves in Australia's Bass Strait

AWE Limited reported Monday that the Operator of the BassGas Joint Venture in permit T/L1 in Bass Strait, offshore Australia, Origin Energy, has provided a preliminary reassessment of reserves for the Yolla field based on new data obtained from the recently drilled Yolla-5 and Yolla-6 development wells.

Interpretation of log and pressure data obtained from Yolla-5 and Yolla-6 has resulted in a reduction in the estimated original gas in place for the field, although further technical work is required to validate this estimate.

Whilst recognizing the need for further analysis, AWE has chosen to adopt the preliminary reassessment of the Operator and reduce its share of reported remaining 2P Reserves for the Yolla field by 5.5 million barrels of oil equivalent (MMboe), down to 13 MMboe (as at June 30). After the recently announced 19.3 MMboe increase in 2P Reserves in the Company’s Sugarloaf project, the Yolla reduction represents 5 percent of the Company’s total remaining 2P Reserves of approximately 100 MMboe.

AWE expects to recognize a non-cash impairment of the carrying value for the BassGas asset of between $73.58 million (AUD 100 million) to $80.94 million (AUD 110 million) after tax in its full year accounts.

AWE’s Managing Director, Bruce Clement, said, “The updated reserves at Yolla will result in less gas production later in the field life, but overall it is not expected to have a material impact on production or cash flow during the next three to four years. We anticipate production from the field will increase to a rate close to the facilities’ capacity of 67 terajoules per day (TJ/day), once the Yolla-5 and Yolla-6 development wells are brought on-stream.

“AWE will now consider accelerating development feasibility studies for the Trefoil field in adjacent permit T/18P to determine if its 2C Contingent Resources of 17 MMboe (AWE share) can be developed earlier as an incremental project to Yolla production,” he said.

Clement added, “AWE will continue to focus on progressing its major development projects, particularly the appraisal drilling and early development of the Waitsia gas project in Western Australia”.

AWE will undertake further detailed assessment of the Yolla field reserves prior to the release of its Reserves and Resources report to be published in the Company’s 2015 Annual Report.

The BassGas project consists of the Yolla offshore well head platform connected by pipeline to the gas processing facility at Lang Lang, Victoria. The Yolla platform is located in Bass Strait, approximately 87 miles (140 kilometers) offshore from Kilcunda, Victoria.

The BassGas Joint Venture partners in T/L1 are:

  • AWE Limited (via subsidiaries) - 35.00 percent
  • Origin Energy Resources Limited (Operator) - 42.50 percent
  • Toyota Tsusho Gas E&P Trefoil Limited - 11.25 percent
  • Prize Petroleum International Pte. Ltd. - 11.25 percent

The Joint Venture partners in T/18P are:

  • AWE Limited (via subsidiaries) - 40.00 percent
  • Origin Energy Resources Limited (Operator) - 39.00 percent
  • Toyota Tsusho Gas E&P Trefoil Limited - 6.25 percent
  • Toyota Tsusho Gas E&P Otway Limited - 5.00 percent
  • Prize Petroleum International Pte Ltd. - 9.75 percent

In a separate announcement, AWE, the Operator of Permits L1/L2 in the Perth Basin, Western Australia, disclosed Monday that at 06:00 hours (6.00am) AWST today the Waitsia-2 appraisal well was at a Measured Depth below Rotary Table (MDRT) of 10,341 feet (3,152 meters) and was preparing to cut core samples from one of the primary target formations, the Kingia Sandstone, following the installation of 9.625 inch intermediate casing at 9,242 feet (2,817 meters) MDRT.

The Waitsia-2 well was spud June 28 and is forecast to take approximately seven weeks in total to complete. The well will be drilled to a planned maximum total depth of 12,477 feet (3,803 meters) MDRT and is designed to test the gas potential in the southern extension of the Waitsia Field, comprising primary targets in the deep conventional formations in the Kingia and High Cliff Sandstones.

If the results are positive, AWE may undertake a flow test of the Waitsia-2 well and the well may be completed as a production well for a potential future field development. The approved work program for the Waitsia-2 appraisal well does not include hydraulic fracture stimulation.

The Waitsia-2 appraisal well is located on agricultural land approximately 10.3 miles (16.5 kilometers) east-southeast of Dongara, Western Australia, and 3.5 miles (5.6kilometers) south-southwest of Waitsia-1. The well is the last of a three well drilling program planned for the Perth Basin in 2015.

The Joint Venture partners in L1/L2 are:

  • AWE Limited (via subsidiaries) (Operator) - 50.0 percent
  • Origin Energy Resources Limited - 50.0 percent


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