Australian-Canadian Oil Royalties Begins Major Drilling Program
Australian-Canadian Oil Royalties Ltd. (ACOR) has begun a large drilling program in the south/west Queensland section of the Cooper/Eromanga Basin. The Mulberry-6 has spud which is the first of a total of 51 planned wells in a $50 million drilling program on the Mulberry Field over three phases on ACOR's ORRI under ATP-299-P Tintaburra block.
The whole program consists of 45 Mulberry delineation wells based on the Talgeberry/Endeavour 3D seismic data, 3-4 near field exploration wells planned for the Aros trend (Aros-2, Talgeberry North-1, Takya North-1 and Winna South-1) and 1-2 near field exploration wells at Mugginanullah where the operator currently has a 314km2 3D survey underway. Mulberry-2 -3 & -5 were all brought on stream in July last year as Jurassic oil producers, with the three wells containing a total cumulative oil column of 22.4m. The operator expects the extensive program to double its production to around 220,000boe per annum.
The Mulberry Field is part of the Tintaburra Block on ACOR's ORRI under ATP-299. The Tintaburra Block is estimated to contain about 84 million barrels of proved plus probable oil in place. The 2006 program is planned to develop the Mulberry Field, commence increased oil recovery from other producing fields and potentially recover an additional 20 million barrels of oil from the Block.
Reduced Drilling Costs:
Drilling costs will be significantly reduced by using new modular design rigs with automated leveling, top drive and automated pipe handling. This will reduce overall rig move time to around 8 hours once drilling proficiency is proven. Three drilling rigs have been contracted from Canada.
The new modular design rigs, coming in from Canada, have automated leveling, top drive and pipe handling, and will require only minimal mobe times, reducing rig costs to the operator.
Advanced Surface Facilities and Reservoir Engineering:
- New oil production will be placed on stream commencing in the first quarter 2006/2007, i.e. by around September, 2006.
- Artificial Lift: Will use lower cost artificial lift systems designed to minimize down time and capital input.
- This will generally involve installation of progressive cavity pumps (PCP's) rather than traditional donkey pumps.
- Power for pumps to be provided by a gas turbine.
- Field development will take advantage of water injection for reservoir pressure maintenance
- Automated testing and monitoring to optimize oil productivity.
- Interconnected piping systems to gather oil at the Mulberry field and pipe it via a new pipeline from Mulberry to the Tarbat facilities. Work on facility upgrades to handle higher oil volumes has commenced.
If the program is successful, the operator anticipates an additional development drilling program in the greater Mulberry area later in 2006.
ACOR owns .05.75% of 1% ORRI under ATP-299
Can History repeat itself?
Could ACOR's PEL 112 become another ATP 299?
Pel 112 covers 818,904 acres and has never been drilled on (no dry holes) and is located in the Cooper/Eromanga Basin of South Australia. Eleven (11) new wells have been announced for drilling this year on the adjoining PEL to the east and to the north of ACOR's PEL 112. The adjoining production is multiple pay with wells averaging a reported $37,000,000.00 a year per well on the adjoining block to the east of PEL 112 and wells averaging a reported $33,000,000.00 a year gross on the adjoining block to the north of PEL 112. The wells are approximately 6,000 feet deep and cost around $1.5 million dollars to drill and complete.
This is some of the most profitable production in onshore Australia. ACOR has just completed a new seismic survey on PEL 112 and discovered two large seismograph highs as well as 28 smaller ones. The two large seismograph highs are called C-23 & C-26, which cover a combined area of approx 5,534 acres with excellent closure.
ACOR is receiving interest from several investor groups with interest in possibly participating in the exploration for oil & gas and associated hydrocarbons on ACOR's PEL 112, including a large oil company from China with several drilling rigs.
ACOR owns 41.5% WI under PEL's 108, 109, & 112.
About Australian-Canadian Oil Royalties Ltd:
ACOR management draws no cash salary. ACOR has NO LONG-TERM DEBT.
ACOR's principal assets consist of approximately 15,293,450 gross
surface acres of overriding royalty interest and approximately
8,900,776 gross acres of working interests, located Onshore Australia
in the Cooper-Eromanga Basin and Offshore Australia in the Gippsland
Basin in the Bass Strait. ACOR is a publicly traded oil company
trading on the NASDAQ OTC Bulletin Board Exchange under the trading
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