12th Sep 2006 07:00
OILEX DRILLING OF CAMBAY-72 WELL COMMENCES IN CAMBAY FIELD, GUJARAT, INDIAOilex is pleased to advise that the first well in the Cambay Field drillingprogramme was successfully spudded at 19:30 hours on Monday 11 September 2006.The well, Cambay-72, is located on the crest of the Western High block of theCambay Field (Figure 1). Drilling operations using the Dalma Energy MR 4 rigcommenced today at 00:00 and the well is expected to take 9-12 days to reachthe planned total depth (TD) of 1835m.Current operations are drilling ahead at 108 metres prior to running 95/8"casing at 600m. On reaching TD, the well will be logged and casing will be runif there are indications of oil and gas in the well. The rig will then move tothe Cambay-71 location and testing of Cambay-72, if warranted, will beundertaken by a workover rig at a later date in October, to be confirmed.The primary reservoir objective is the Oligocene sandstone (OS II) and thesecondary objectives are at Miocene and Eocene levels. These sandstonereservoir units are proven producers in fields immediately to the north andsouth of Cambay Field. Oil is being produced on the Western High at low rateson an intermittent basis from wells that have suffered formation and well boredamage in the past.Figure 1 - Location and Depth Map of OS II Objective, Cambay Field, Gujarat,IndiaResource estimates for two potential reservoir units (Oligocene OS II andEocene EP IV) were published in May 2006. Accounting for the possible presenceof oil and /or gas on the eastern flank and the western high trend, the bestrevised estimates and the range of potential oil and gas resource originalvolume in place are given in Figure 2. RESOURCE ORIGINAL VOLUME-IN-PLACE Low Estimate Best Estimate High Estimate OIL (million stock tank 16 43 108barrels) GAS (billion cubic feet) 105* 173 432 CONDENSATE (million stock 1.6 3.7 9.8tank barrels) Figure 2 - Estimates of the potential hydrocarbonsoriginally in place(100%basis) calculated for the Western High trendand eastern flank at the stratigraphic level OS II and EP IV sandstones.* The low estimate gas volume takes account of 52 bcf produced to date from theeastern flank area.Oilex is Operator of the Cambay Field and holds a 45% equity interest, 15% ofwhich Oilex acquired from Niko Resources Ltd and remains subject to approval bythe Government of India. Gujarat State Petroleum Corporation Ltd holds thebalance 55% interest in the Cambay Production Sharing Contract.A related Media Release is attached hereto.For and on behalf of the Board,B. H. McCarthyManaging Directorcc: Directors: MC/GIJ/RGBThe information in this report has been compiled by the Managing Director ofOilex NL, Bruce McCarthy B.Sc. Hons. PhD (Geology) who has over 27yearsexperience in petroleum geology. The estimates of hydrocarbons in place wereprepared by Paul RobinsonB.Sc. Hons. PhD (Geology), an independent consultantto Oilex NL who has over 25 years experience in petroleum geology and resourcesestimation and is a member of the AAPG.The resource estimateswere reviewed byRay Barnes, the Technical Director of Oilex NL who has over 35 years experiencein petroleum geology and is a member of the AAPG. Mr Barnes reviewed thisannouncement and consentsto the inclusion of the estimated hydrocarbons inplace in the form and context in which they appear.For further information, please contact:Bruce McCarthy, Managing Director Oilex NL Tel. +61 8 9226 5577 (WesternAustralia)Archie Berens, Director Pelham Public Relations Tel. +44 20 7743 6679 (UnitedKingdom) * MEDIA RELEASE 11 SEPTEMBER 2006 OILEX COMMENCES MAIDEN INDIAN DRILLING PROGRAM AT ONSHORE CAMBAY FIELD TARGETS WITH ESTIMATED RESOURCES-IN-PLACE OF 16-108M BARRELS OF OILAustralian-based Oilex NL (ASX: OEX, AIM: OEX) has commenced its first drillingprogram in north-western India since repositioning as an international oil andgas company earlier this year, with the announcement today that the first wellin a planned 2-3 well program in the onshore Cambay Field in Gujarat State hadsuccessfully spudded. Cambay Field is located in a prolific onshore petroleumprovince in Gujarat at the northern end of the Bay of Cambay, close to existingpipelines and industrial infrastructure in the main heavy industrial corridor ofIndia.The well, Cambay-72, is located on the crest of the Western High block onCambay Field and is being drilled by the Dalma MR-4 rig which commencedoperations at 19:30 local time on Monday, 11 September. At 06:00 today, the rigwas drilling ahead at 108m. The well is expected to take 9-12 days to reach itsplanned total depth (TD) of 1,835m. On reaching TD, the well will be logged andcasing will be run if there are indications of oil and gas in the well. The rigwill then move to the second well location, Cambay-71, and testing, ifwarranted, will be undertaken by a workover rig at a later date.The initial two well locations were selected based on a detailed assessment ofhistoric data from the Cambay Field wells. Two wells have been optimallylocated to intersect the possible oil leg on the Western High Trend and toacquire modern wireline and formation fluid and pressure information to aid innormalising the existing database.The primary reservoir objective is the Oligocene sandstone (OS II) and thesecondary objectives are at the Miocene and Eocene levels. These sandstonereservoir units are proven producers in fields immediately to the north andsouth of Cambay. Oil is being produced on the Western High at low rates on anintermittent basis from wells that have suffered formation and well bore damagein the past.The upgraded oil and gas resource estimates for the Cambay OS II and the EoceneEP IV sandstones on the Western High Trend are 16-108 million barrels of oil(with a best estimate of 43 million barrels), 77-432 billion cubic feetof gas(with a best estimate of 173bcf) and 1.6-9.8 million stock tank barrels ofcondensate(with a best estimate of 3.7million stock tank barrels).Oilex's Managing Director, Bruce McCarthy, said the spudding of the Cambay-72well was an exciting milestone for the Company, with the first-phase drillingprogram representing the culmination of months of negotiation and technicalanalysis. "This is our first major drilling program to commence since thecompany adopted a new direction last year and is one of the key programs thatwill be funded by the recent successful $20 million share placement," McCarthysaid.Oilex recently took over as operator of the Cambay Fieldand and has a 45% interestin the field, 15% of which was acquired from Niko Resources Ltd and remainssubject to approval by the Government of Indian. Gujarat State PetroleumCorporation Ltd ("GSPC") holds the balance 55% interest in the CambayProduction Sharing Contract.Oilex also holds a 40% interest in each of the Bhandut Field, located to thesouth of Cambay, near the industrial centre of Hazira, an the SabarmatiField, located further to the north, near Ahmedabad, subject to approval by theGovernment of India, with GSPC holding the balance of 60%.. ENDOILEX NLRelated Shares:
OEX.L