18 January 2016
Carnarvon Petroleum Limited ("Carnarvon") (ASX:CVN) provides the following update on drilling operations as advised by the operator of the Roc-1 well, Quadrant Energy.
Progress
Since the last report the wireline logging program has been successfully completed and the rig has left the Roc- 1 location.
Laboratory analysis of the gas recovered from the well has confirmed condensate rich gas. Important information from the initial analysis is the confirmation of a condensate to gas ratio at the top end of the range previously announced of 20 to 40 barrels per million cubic feet of gas.
Forward Plan
Carnarvon estimates it will be in a position to advise the market on the expected range of recoverable volumes of gas and condensate within the next six weeks.
Carnarvon's joint venture partner, privately owned Finder Exploration, recently released on its website preliminary information on the well results. In the interests of ensuring that stakeholders in the Roc-1 well possess similar information relating to the well, the release of Finder Exploration is attached for the information of Carnarvon shareholders. Carnarvon reiterates that the information provided is preliminary, subject to the completion of well data analysis and does not comply in all respects with the disclosure standards of information prepared for release to the market by Carnarvon. As such, shareholders should exercise caution in their use of the information released by Finder Exploration.
Appreciating the Roc-1 well has just completed and data from the well needs to be properly assessed, a decision on the timing and location of the Roc-2 well has not yet been considered by the joint venture. This will be done in due course and will be subject to joint venture and government approvals and rig availability.
Cost Estimate
The cost for the Roc-1 well was on budget inclusive of success case logging, sampling and coring costs. Under previous farm-out agreements, in exchange for equity in the permits, Carnarvon bore no cost for this well.
Under the above mentioned farm-out agreements there remains a carry contribution towards any further drilling or testing in the WA-437-P permit of approximately A$30 million to A$40 million (gross).
Managing Director's comment
Carnarvon's Managing Director, Adrian Cook in commenting on the well results said "On behalf of the Carnarvon board and management I extend our appreciation to the Quadrant Energy team for their efforts in successfully executing these drilling operations in a safe, timely and cost effective manner.
I'm becoming increasingly encouraged by the initial well results that we've seen to date, particularly the new information pointing to a strong condensate to gas ratio. Whilst significant work will be undertaken in the coming months, a key priority will be to complete an estimate of the recoverable volumes involved, a process that is currently underway."
Location
The Roc-1 well is located in WA-437-P, approximately 20km south-east of the 2014 Phoenix South-1 oil discovery, and around 150km north of Port Hedland.
The equity interest holders in WA-437-P are: Carnarvon Petroleum | 20% |
Quadrant Energy (Operator) | 40% |
JX Nippon | 20% |
Finder Exploration | 20% |
Yours faithfully
Adrian Cook Managing Director Carnarvon Petroleum
Shareholder enquiries: Media enquires:
Mr Thomson Naude Mr Tony Dawe
Company Secretary Professional Public Relations
Phone: (08) 9321 2665 (08) 9388 0944 / 0405 989 743
Email: investor.relations@cvn.com.au tony.dawe@ppr.com.au
Phoenix South oil field (2014) and Roc gas field (2015)
Bayu/Undan
Argus Poseidon
Torosa
Brecknock/ Calliance
Ichthys
Troughton Is.
Petrel
Wadeye
Scarborough
Jansz/ Io
Rankin Trend
WA-435-P
20%
Phoenix
Phoenix Sth Roc
WA-436-P
30%
WA-438-P
30%
Broome
Derby
40% and Operator
Clio
Gorgon
Dampier
Port Hedland
JX Nippon Oil & Gas Exploration
WA-437-P
20%
20%
20%
20%
Bedout Sub-basin - 100% success in emerging hydrocarbon province!!
Page 2
Phoenix South oil field (2014) and Roc gas field (2015)
WA-435-P
20%
WA-436-P
30%
Broome
Phoenix South-1
Phoenix
Phoenix Sth
Roc-1
Nebo Roc
WA-437-P
20%
~130 km
WA-438-P
30%
Port Hedland
3D visualisation of near top hydrocarbons
all wells drilled on 3D seismic data within this emerging and prolific hydrocarbon province have been successes:
2014 Phoenix South-1 oil discovery (up to 300 mmstb OOIP*)
2015 Roc-1 gas discovery (up to 1.2 TCF OGIP*)
Roc-1 - proven gas
reservoir sands of ~10% Ф with 10s -100 mD permeability & strong water drive
3 gas columns intersected but pressure offset is only ~12 psi at 4,400 metres
initial assessment - liquids rich gas (40-60 bbls/mmcf) with low CO2 & no H2S
Page 3
OOIP is "Original Oil in Place" and OGIP is "Original Gas in Place"
100% success in emerging hydrocarbon province!!
Bedout Sub-basin - Roc-1 Finder's initial assessmentcrestal test of primary target was water wet (Phoenix South oil pay level)
wet gas pay was intersected at the secondary target
Finder's preliminary near top gas reservoir depth map
~40 km2
sands 1,2&3
sands 4&5
~90 metres
GWC
GWC
Reservoir section schematic -
Note: significant vertical exaggeration
intersection ~90 metres down-dip from crest with ~40 km2 up-dip potential
400 BCF OGIP* in sands 1, 2 & 3
1.2 TCF highside OGIP* if deeper sand is gas filled up-dip (sands 4 & 5)
determines the limits of the Roc gas field
* OGIP is "Original Gas in Place"
Phoenix MC3D seismic data courtesy of Spectrum
Page 4
100% success in emerging hydrocarbon province!!
Bedout Sub-basin - significant upside and running roomsignificant oil in the system, ie
Phoenix South oil field
Roc-1 has excellent oil shows:
above the Phoenix South-1 pay levels;
in the gas reservoir; and
bottom 50 metres with possible sand development at TD!
~22,000 km2 acreage captures the known limits of the petroleum system
~60 further prospects & leads > 10 km2 currently identified
WA-435-P 20%
~5,100 km2
Phoenix
~3,450 km2
WA-436-P
30%
~4,600 km2 of existing 3D data
plus current data gathering phase:
~5,100 km2 new 3D seismic data &
~9,800 km 2D data
de-risked exploration & appraisal drilling - next step is Roc-2
~US$5 million net drill carry remaining
Phoenix South
~1,100 km2
Roc
WA-437-P 20%
Keraudren-1
~9,800 km
WA-438-P
30%
Page 5
100% success in emerging hydrocarbon province!!
Bedout Sub-basin - many commercialisation optionsBedout Sub-basin offers a naturally hedged portfolio
gas for the domestic market and/or oil depending on the economic cycle
Roc-1 commercial viability - simple, low cost development close to infrastructure
initial indications of high quality gas
Noble Tom Prosser
the rig used for the 2015 Roc-1 gas discovery
jack-up water depth and ~130 km offshore from the coast north of Pt Hedland - similar to Quadrant's Devil Creek Gas Plant and the 450 BCF Reindeer gas field
Fixed shelf platform
with dehydration
Condensate
LPG
SSIV
Wells
Onshore
reception
Roc-1 commercialisation options
existing DomGas suppliers;
LNG producers with a DomGas obligations; plus
potential Pilbara resource ventures and local power generation
Page 6
100% success in emerging hydrocarbon province!!
Carnarvon Petroleum Limited issued this content on 18 January 2016 and is solely responsible for the information contained herein. Distributed by Public, unedited and unaltered, on 28 January 2016 14:09:03 UTC
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