Magellan Petroleum Spuds Keeley-1 in Cooper Basin

Magellan Petroleum

Magellan Petroleum's subsidiary, Magellan Petroleum Australia Limited, says that the Keeley-1 exploration well spudded in PEL 107 in the Cooper Basin of South Australia on October 22. Keeley-1 is the first of a further two farmin wells in PEL 107 in which Magellan will participate under an arrangement with Great Artesian Oil and Gas during the current Cooper Basin drilling program. Magellan will earn a 30% interest in any commercial discovery made by the farmin wells by funding Great Artesian Oil and Gas' interest in the wells. Upon Magellan funding its participation in these two wells it will also earn a 20% participating interest in the PEL 107 joint venture and permit and it will participate in Talia-1 at its 20% working interest in the permit. Magellan participated in the Kiana-1 and Tyringa-1 wells in PEL 107 in 2005 under the same arrangement with Great Artesian Oil and Gas which resulted in the discovery of the Kiana oil field.

The Keeley prospect is located on the western side of the Spencer High, approximately 11 km west-southwest of the Raven gas field, 5 km north-northwest of the Spencer West oil field and 8 km west-northwest of the Kiana oil field. Keeley-1 will test a combined Permian anticlinal closure and stratigraphic trap in the southern Patchawarra Trough in PEL 107. The Keeley prospect is considered prospective because of its similarities with the Raven gas field. The Keeley prospect is a robust closure and volumetric estimates put its best estimate prospective resource at approximately 10 bcf of gas. It has a high estimate prospective resource of approximately 29 bcf of gas if stratigraphic trapping is also involved.

The primary reservoir objectives in Keeley-1 are the Patchawarra Formation reservoirs, similar to those which produce gas at Raven and in which gas has been discovered in the recent Udacha-1 and Middleton-1 wells. The Keeley-1 well which is being operated by Beach Petroleum will take approximately 16 days to drill and evaluate and is planned to have a total depth of approximately 3023 meters.