Liberty News. For 19 July 2013

 

 

Proteus-1 Exploration Well in WA-398-P

 

06:00 WST on the 19th of July Proteus-1ST1 was drilling ahead in the 6-1/2” hole at a depth of  4583 meters.

 

Since the last update the 7-5/8” liner was cemented and pressure tested before running in hole and drilling ahead with the 6-1/2” drilling assembly.

 

ConocoPhillips is the operator of the jointly held WA-314-P, WA-315-P and WA-398-P Browse Basin permits containing the previously announced Greater Poseidon gas discoveries.  Karoon Gas Australia Ltd holds a 40% equity interest in permit WA-315-P and WA-398-P, and a 90% interest in permit WA-314-P.

 

Proteus-1 is the third well in the exploration program.  Proteus-1 is located in permit WA-398-P on a large tilted fault block approximately 14 kilometers south south east of the Poseidon-1 discovery well.

 

The Transocean Legend semi-submersible rig is drilling the exploration well, which is operated by ConocoPhillips.

 

Upcoming Well Program

 

Grace prospect in WA-314-P is the next scheduled drill prospect.

 

            PetroChina and ConocoPhillips enter into agreements for a 20%

interest in Poseidon

 

7 March 2013 - As part of a larger set of agreements, including the sale of two separate interests in Australia and a joint study agreement in China, ConocoPhillips has agreed to sell to Chinese National Petroleum Corporation (“PetroChina”) a 20% interest in the Browse Basin joint ventures covering exploration blocks WA-315-P and WA-398-P which include the Poseidon gas condensate discovery.

 

Pursuant to the terms of the joint ventures between Karoon and ConocoPhillips, Karoon has pre-emptive rights over the 0% interest being sold to PetroChina.  This right will lapse at the beginning of April and Karoon is currently assessing its position with respect to the pre-emptive rights.

 

 

 

Zephyros-1 Exploration Well in WA-398-P

 

13 March 2013, at 06:00 hours (WST) today, Karoon advises that wireline logs were being acquired in the Zephyros-1 well.  Since the last update, 108 meters of core was cut and recovered to surface and the well was drilled to its total vertical depth of 5372 meters before conducting wireline logging.

 

·         The Zephyros-1 well penetrated gas bearing Plover Formation sands similar to that seen at Kronos-1.

·         Zephyros-1 reservoir sands are good quality, intervals of which are interpreted to have some of the highest mobility values (ability to flow gas) recorded from MDT sampling tools in any of the JV’s Poseidon area wells.

·         In the case of a production test, Zephyros-1 would be expected to flow at similar, tubing constrained, rates to Kronos-1.

·         Pressure data through the gas column indicates a possible deep gas-water contact similar to the interpreted at Kronos-1.

·         The 108m of cut core will provide a high quality data set for further reservoir characterization.

·         Numerous reservoir fluid and pressure samples were gathered, allowing the joint venture to further assess the greater Poseidon resource size and gas composition while also providing information for use in the estimated well production rates for any development wells in the future.

 

Boreas-1 Well test flows at a facility constrained stabilized rate of 30 million standard cubic feet per day.

 

24 October 2012    -    Boreas-1 Exploration Well in WA-315-P

 

A production logging run is being performed as the final operation of the production testing program at Karoon Gas Australia Ltd’s Boreas-1 exploration well.  Upon completion of this final operation, the  testing string will be removed from the well.

 

During flow testing this week, Boreas-1 exploration well flowed gas to the surface at an equipment constrained maximum sustained rate of up to 30 MMscf/d through a 40/64 inch choke at a well head pressure of 3300 psi.

 

A Condensate-Gas Ratio of 18 bbl/MMscf was measured at the surface, along with a 16% CO2 content taken from the gas flow on a volume basis.  This condensate/gas ratio is almost double the rate discovered in the Kronos 1 well.

 

The flow rates were achieved from a multi-rate flow test flowed by pressure build up and a bottom hole reservoir fluid sampling in a perforated interval of 70 meters between 4904 and 4974 meters in the primary target Plover formation.

 

Based on an analysis of the well test date, Karoon believes that futre production wells drilled adjacent to the Boreas-1 location have the potential to flow at commercial rates in excess of 100MMscf/d.

 

Kronos-1 -  Confirmed equipment constrained maximum sustained production test flow rate of 26 million standard cubic feet a day from the Kronos-1 Well

 

27 May 2010 - At 0600 hrs today, Karoon advises the production test of the Kronos-1 exploration well was complete and the testing string was being removed from the well.  Since the last report, testing operation included a multi-rate flow test followed by a pressure build-up and bottom hole reservoir fluid sampling.

 

The maximum sustained flow rate attained during the multi-rate test was 26MMscf/d through a 32/64” choke, with a flowing wellhead pressure of 3900 psia.  As with the previously released clean up flow rates, the flow rates achieved were equipment constrained.  A condensate-Gas Ratio of 9.5bbl/MMscf was measured at the surface, along with a 10% CO2 content taken from the gas flow on a volume basis.

 

Based on an analysis of the well test data, Karoon believes that future production wells drilled adjacent to the Kronos-1 location have the potential to flow at commercial rates in excess of 100 MMscf/d.

 

 POSEIDON-2

 

Montara Formation testing

 

3 February 2010 - At 1200 hrs WST today, a drill stem test of the Montara Formation reservoir over the interval 4714-4721 & 4727-4731mRT was in progress.  After reviewing flow and pressure data, the Joint Venture has elected finish the test effective immediately.  WE will now commence preparations to plug and abandon the well as previously advised upon the completion of well operations.

 

Karoon believes that it is highly likely that communication to the Montara reservoir was not established during perforation procedures.  Lack of suitable equipment at the well site directed at attempting to establish communication to the Montara reservoir has resulted in the decision to move to commence drilling in a new location.

 

The Montara Formation reservoir sands were first penetrated in the Poseidon-2 well within the Poseidon field.  Petrophysical and mudlog data provides strong indications that moveable gas exists in the reservoir which will be a serious target for futher evaluation and eventual production testing in future appraisal wells to be drilled over the coming months.

 

Plover B Formation testing

 

Since the last report the Plover-B DST testing program over the interval 5039-5060 & 5085-5100mRT was completed.  Gas was produced to surface at a maximum rate of 850scf/d on a 1” choke.  Based on the low permeability measured in the B sand core, Karoon interprets that higher flow rates are achievable.

 

Karoon’s interpretation of the restricted flow resulted in part from completion brine being present in the well, severely restricting gas flow to surface.  Liquids volumes were not measured due to the low gas rates (gas-liquids separator not used).

 

A Plover B gas sample was taken at the surface and preliminary compositional analysis shows high methane content, some associated heavier hydrocarbons and low CO2 levels.  Laboratory analysis of preserved gas samples will be used to further define gas composition and any potential liquids yield of the reservoir gas.  Further analysis of reservoir gas compositions will be conducted over the course of the appraisal program.

 

Geological and reservoir simulation modeling by Karoon of the Poseidon field incorporating the Poseidon-2 Plover-B core permeability data are considered unlikely to materially impact the Karoon pre-drill P50 7 TCF Poseidon Contingent Resource estimates for the Plover reservoirs.

 

Plover-B Formation Reservoir evaluation

 

The Poseidon-2 well has met the objective of testing the extent and quality of reservoirs down dip from the Poseidon-1 discovery in a thickened Plover Formation interval (as defined by seismic).

 

Positioning of the well 6 kilometers from Poseidon-1 in a down-dip setting was considered risky with respect to obtaining high gas flows, but information from down-dip positions on the field is critically important for optimal field appraisal.  The timing of drilling this well in the overall appraisal program was in part dictated by the permit conditions of WA-398-P.

 

This well also supports Karoon’s view that the A and C sand intervals have overall better reservoir facies development than the highly interbedded B sand interval.  As such, reservoir quality and testing results from the B sand at this location are not considered representative of either of the other sand intervals A and C in the field, nor is it necessarily representative of the B reservoir unit over the remaining field area.

 

Summary

 

The Poseidon-2 appraisal well has:

 

·         Discovered a new Montara Formation gas reservoir.

·         Penetrated the three Plover Formation reservoir units A, B and C discovered in the Poseidon-1 well, establishing continuity of the gross sand intervals and intervening shales over a large part of the field.

·         Conducted Drill String Tests (DST’s) that prove log interpretation results identifying the presence of movable gas and adequate reservoir quality in the B reservoirs above the Gas Water Contact at this location.

·         Demonstrated that Plover-B core measured permeability at this down-dip location is sufficient to contribute to overall field gas recovery.

·         Preliminary gas analysis of gas recovered at surface, shows presence of heavier HC components and low CO2 content.

 

POSEIDON-1 EXPORATION WELL IN WA-315-P

 

19 May 2009  -  Karoon Gas Australia Ltd advises that at 06:00 hours (WST) today, preparations are underway to plug and abandon Poseidon-1 as a significant gas discovery.  Wireline log porosity and pressure measurement data suggests the well is capable of flowing gas.

 

The Joint Venture has commenced planning a Poseidon Field appraisal program.  The next well in the current program will be Kontiki-1.

 

Since the last report the 5” liner was run and cemented in the Poseidon-1 well, however there was a mechanical failure while attempting to retrieve the lining hanger setting tool.  This resulted in the well being irreparably plugged above planned test intervals making it impossible to carry out the planned production tests.  After successful attempts at recovery of the tool, the Joint Venture decided to plug and abandon Poseidon-1.

 

The Joint Venture has obtained significant information from Poseidon-1 as outlined below:

 

·         The well has penetrated a 317m gross gas bearing Plover Formation over the interval 4795 to 5112mRT with three gross gas bearing sands totaling 228 m.

·         Wireline pressure testing of four data points and sampling (MDT tool) in the lower sand interval shows a gas gradient, indicating that the reservoir contains gas.

·         The gas water contact has not been penetrated, indicating the potential for additional gas below the total depth of Poseidon-1.

·         Estimation of reservoir permeability (indicative of flow rates) based on log derived porosity and four pressure data points, suggest that that reservoir section will flow gas.

·         As Karoon has currently mapped, the well is located over one hundred meters below the trap crest of the Poseidon structure with an interpreted gross gas column for the structure of over 430m.  The area of the structure as currently mapped is around 280 square kilometers.  Remapping is underway.

·         Karoon’s analysis of seismic and well results to date indicate the contingent resource discovered in this well is likely to be consistent with or exceed Karoon’s pre drill prospective resource range (P10-15 TCF, P50-7 TCF and P90-3 TCF).