Arc Energy Spuds Hovea 9 Well in Perth Basin

Arc Energy and its partner, Origin Energy, recently completed the Hovea 8 horizontal production well which is now on production through the Hovea Production Facility which is currently producing in excess of 6,000 barrels of oil per day. The Hovea field is located in the Perth Basin in Australia. Earlier this month the Century 24 rig spud the Hovea 9 well which is being drilled as a vertical well from a surface location some 1.2 km south of the Hovea Production Facility. The well is located to intersect the edge of the Hovea Field as currently mapped. The aim of the well is to better define the southern extent of the field, give greater confidence to field reserves and provide a point for water injection into the reservoir to provide pressure support. Depending on the results of the initial intersection the well is likely to be sidetracked to an optimal water injection location to the west of the field.

The water injection systems in the north Perth Basin fields are designed to optimize both recovery rates and recovery efficiency, and the current system at Hovea utilizing the Hovea 1 well has proven extremely effective at achieving these objectives.

Consequently, as well as providing valuable appraisal information on the southern end of the Hovea Field, Hovea 9 will also optimize oil recovery from this area of the field.

At the completion of the Hovea 9 well the Century 24 rig will drill the Eremia 2 horizontal appraisal/production well on the Eremia Field. It is anticipated that if Eremia 2 achieves its objectives it will recover the majority of the reserves in the field and will confirm the development model that has been developed for future fields.

At the completion of Eremia 2 the rig will be available to either drill exploration wells or undertake further development drilling.

The joint venture is close to finalizing its intentions for the ongoing program which is likely to involve a mixture of exploration and development wells and, if all parties’ objectives are to be met, may involve the mobilization of a second rig into the basin.

Participants in L1 and L2 (excluding the Dongara, Mondarra and Yardarino fields) are Arc Energy as operator with 50% and Origin Energy with the other 50%.