28th Mar 2007 11:13
OILEX LTD28 March 2007AIM Market LondonDear Sir,
subject: Cambay field- resource estimate and work program
Oilex Ltd is pleased to advise that the Cambay Joint Venture has submitted the annual in-place resource estimate for the Cambay Field, in accordance with the regulations, to the Directorate General of Hydrocarbons (DGH), the representative of the Government of India in the Cambay Production Sharing Contract. This estimate (Table 1) incorporated the interpretation of the recently acquired Cambay 3D seismic survey and new well data and is confined to the OS II and EP IV reservoir intervals in the Cambay Field.
RESOURCES ORIGINAL VOLUME-IN-PLACE* Low Estimate Best Estimate High Estimate OIL (million stock tank barrels) 26 48 91 (May 2006estimate) (16) (43) (108) #GAS (billion cubic feet) 186 356 702 (May 2006estimate) (105) (173) (432) CONDENSATE (million stock tank 7 14 28barrels) (1.6) (3.7) (9.8) (May 2006estimate)
* Reported as proved, probable and possible resources to DGH per regulation.
# Includes approximately 52 BCF of gas produced to date.
Table 1.Total discovered hydrocarbon resource in-place estimation - March 2007.
A selective drilling programme designed to prove a reserves base by the end of 2007 is the centrepiece of the 2007-2008 Cambay Field Work Program that was approved recently at a series of meetings in India.
Resource Estimation- Depth structure mapping of the Cambay 3D seismic survey, data acquired recently from the latest drilling and the substantial existing well data base were integrated to quantify the discovered hydrocarbon-in-place resources identified to date in the Oligocene OS II and Eocene EP IV sandstones in each of several major hydrocarbon-bearing structural compartments. The presence and distribution of in-place hydrocarbons is demonstrated by test and production data combined with wireline log responses from approximately 65 wells drilled in the Contract Area.
The hydrocarbon distribution is now better defined by more accurate fault mapping and seismic amplitude extraction from 3D data and is supported by well data in the field area. The remaining uncertainty in calculating hydrocarbon volumes rests with the definition of hydrocarbon fluid boundaries and reservoir net pay. These uncertainties were accommodated in the resource estimate by applying probability analysis to generate a range of oil and gas volumes which will be addressed during the Phase 2 drilling campaign.
As illustrated in Table 1, the evaluation has resulted in redistribution of some of the oil resources compared to the May 2006 estimate. The recognition of additional gas resources based on seismic attribute analysis is reflected by a substantial increase in gas and condensate volumes.
An estimate of undiscovered (exploration) resources of 60 million barrels of oil and 120 billion cubic feet of gas was also provided to the DGH to account for potential resources mainly in deeper stratigraphic units.
Work program - The major component of the work program approved for 2007 is the execution of the Phase 2 drilling campaign, comprising 6 wells, in the Cambay field. A combination of re-entry, sidetrack and new wells has been sanctioned with the primary objective of acquiring new reservoir and fluid data for the Oligocene and Eocene hydrocarbon zones that have been identified from the field's production and well testing history. Along with data from existing wells, this information will be used to determine oil and gas reserves in the major compartments of the field and will form the basis for planning the re-development of the Cambay field. The proposed locations of the drilling operations for 2007 are shown in Figures 1 & 2 attached. A number of wells are also planned to be extended to target deeper exploration objectives in settings analogous to nearby oil discoveries.
Tenders have been received for the supply of drilling equipment for the Phase 2 campaign, with the intention of optimising the program such that up to 3 wells can be completed during the period May-July 2007 with the balance of the firm 6 well program completed later in 2007. A capacity to conduct further drilling operations subject to initial well results will be arranged with drilling rig contractors.
Participants in the Cambay Production Sharing Contract are:
Joint Venture Party Participating Interest Oilex (Operator) 45% Gujarat State Petroleum Corporation Ltd 55% Yours sincerely,B. H. McCarthyManaging Director
For further information, please contact:
Ray Barnes, Technical Director, Oilex Ltd Tel. +61 8 9226 5577 (Western Australia)
Archie Berens, Director Pelham Public Relations Tel. +44 20 7743 6679 (United Kingdom)
The information in this report has been compiled by the Managing Director of Oilex Ltd, Bruce McCarthy B.Sc. Hons. PhD (Geology) who has over 26 years experience in petroleum geology. The estimates of hydrocarbons in place were prepared by Paul Robinson B.Sc. Hons. PhD (Geology), an independent consultant to Oilex Ltdwho has over 25 years experience in petroleum geology and resources estimation and is a member of the AAPG and were reviewed by Mr Ray Barnes, the Technical Director of Oilex Ltdwho has over 35 years experience in petroleum geology and is a member of the AAPG. Dr Robinson and Mr Barnes both reviewed this announcement and consent to the inclusion of the estimated hydrocarbons in place in the form and context in which they appear.
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Figure 1 Cambay Field - OS II structure map showing distribution of discovered hydrocarbonresourcesand proposed 2007 drilling operations.
[Refer Website: www.oilex.com.au]
Figure 2Cambay Field - EP IVstructure/seismic amplitudemap showing distribution of discovered hydrocarbonresourcesand proposed 2007 drilling operation.
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