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RNS Number : 8039E
Roxi Petroleum Plc
13 February 2015
Roxi Petroleum PLC
("Roxi" or the "Company")
Operational Update
Roxi, the Central Asian oil and gas company with a focus on
Kazakhstan, is pleased to further update the market with news of
progress at its BNG asset, and in particular progress at its Deep
Well A5.
Background
The BNG Contract Area is located in the west of Kazakhstan 40
kilometers southeast of Tengiz on the edge of the Mangistau Oblast,
covering an area of 1,561 square kilometers of which 1,376 square
kilometers has 3D seismic coverage acquired in 2009 and 2010.
Roxi has a 58.41 per cent interest in the BNG Contract Area.
Deep Well A5
Background
The well was drilled to a total depth of 4,442 meters. Casing
was set to a depth of 4,077 meters and the core sampling revealed
the existence of a gross oil-bearing interval of at least 105
meters from 4,332 meters to at least 4,437 meters.
The well is to be tested on an open-hole basis. This is
principally because there is a stuck pipe in the interval between
4,322 and 4,401 meters. The stuck pipe is not expected to affect
the outcome of the 30-day test and we will seek to remove it
following the completion of that test.
Blocked well
In December 2014, its was announced that commencement of the
30-day well test at Deep Well A5 was dependent upon the removal
from the sub-surface of fluids used in the drilling of the well, so
that the oil may flow to the surface ( "cleaning-up" the well).
The extremely high-pressure in the well (7,000 psi at surface)
required the use of drilling fluids with a high density (2.16
g/cm3) and removing this high density drilling fluid has been
problematic.
Some of the excess drilling fluids were ejected due to the high
well pressures, but it became clear that intervention would be
required to complete the operation.
As previously announced it was decided the best way to clean-up
the well for testing would be using coil tubing equipment. However,
as also previously announced, due to the high pressure in the well,
the coil tubing equipment became stuck at a depth of 2,996 meters.
The coil tubing was cut at a depth of 30 meters at wellhead. Since
December 2014, work has continued to remove both the remaining
excess drilling fluid and the coil tubing.
Current position
Roxi is pleased to announce that the major part of coil tubing
has now been removed from the well. However 50 meters of coil
tubing remains in the well and that core tubing still contains
drilling fluids, which are trapped by a metallic object believed
dropped during the clean-up works.
Roxi plans, during the remainder of February, to remove these
obstruction using conventional fishing techniques with a target
that the 30-day well test can start in March 2015.
If necessary part of the casing will be removed towards the
bottom of the well at depth of 4,073 meters, to allow the open-hole
testing to be conducted at a higher level than previously
expected.
Further announcements on the work to remove the obstruction will
be made in due course.
Stuck pipe
As previously announced, once the 30-day well test is complete,
should we not be able to remove the stuck pipe we would, as a last
resort seek to sidetrack the well from a depth of 4,320 meters
running a 4.5 inch liner to the bottom of the well and then
continue to test on a conventional basis. We expect this would to
take up to a further 3 months to complete following the 30-day well
test.
Deep Well 801
Deep Well 801, which was spudded on 15 December 2014, is now to
be drilled to a total depth of 4,950 meters targeting the Lower
Carboniferous. The well is being drilled by Sinopec, the Chinese
multinational, at a fixed cost of $11 million.
Deep Well 801 is located approximately 8 kilometers from Deep
Well A5 and will be targeting the same structure as Deep Well A5
and in the Lower Carboniferous. Drilling has reached 2,978 meters
without incident.
Our plan is to continue to drill to a depth of 3,550 meters
before pausing to set casing to that level. We then plan to drill
through more difficult intervals comprising first a salt layer of
approximately 300 meters starting at approximately 3,540 meters and
then an 800 meter section with high pressure in the lower
Permian.
The final 310 meters to be drilled to a Total Depth of 4,950
meters is expected to be less difficult to drill. Periodically
during the remaining stages of drilling work will pause, to set
casing.
We continue to expect the well will reach Total Depth by mid
April 2015.
Deep Well A6
Roxi plans to spud Deep Well A6 following the clean up and
removal of the stuck pipe at Deep Well A5. The well will use the
same rig as for Deep Well A5 and is planned for a Total Depth of
4,700 meters targeting the Lower Carboniferous.
Deep Well A6 will be located some 1,800 meters from Deep Well A5
and will be targeting the same oil-bearing formation revealed in A5
in the Lower Carboniferous.
The contract for drilling the well has yet to be finalised but
the recent and sustained fall in the price of oil has significantly
reduced the third party contractor costs of drilling and Roxi
expects the costs of this and further well be be significantly
lower than for Deep Wells A5 and 801.
BNG Shallow
Background
Our shallow wells at BNG are located in the South Yelemes
portion of the BNG Contract Area extending over an area of 800 sq.
km, a few kilometers from the deep prospects.
We have drilled 12 wells in this area with depths varying
between 2,500 and 3,000 meters.
The quality of oil produced from our shallow wells is not as
good as from the deeper prospect, as it has higher sulphur content.
Over the medium term we plan to blend this oil with the higher
quality oil to be produced from the deeper horizon to maximise
overall BNG sales proceeds.
We are particularly interested in the Valanginian horizon, which
we believe may extend to some 200 square kilometres and our
approach has been to drill several wells to prove the size of this
area.
Wells 54, 805, 806 and 807 were all drilled to depths between
2,500 and 3,000 meters and have all produced oil from either the
Valanginian or Jurassic, and are considered by Roxi to be
commercial.
Current position
Aggregate production from these wells is currently 375 bopd (219
bopd net to Roxi).
Testing continues at Well 143 with preparations underway to
perforate intervals between 2692 and 2693.5 meters and also between
2,704 and 2,709.5 meters.
Comment:
Clive Carver, Chairman said
"We are pleased with both the pace and results to date of the
clean-up work at Deep Well A5. Based on current progress we expect
the 30-day well test will now start in March.
We are also pleased with the drilling to date at our second Deep
Well 801. The lessons learned at Deep Well A5 should help us
greatly now we approach the most difficult phase of the well."
Enquiries:
Roxi Petroleum PLC Clive Carver, Chairman
+7 727 375 0202
WH Ireland Ltd James Joyce / James Bavister
+44 (0) 207 220 1666
Qualified Person
Mr. Nurlybek Ospanov, Roxi's senior geologist who is a member of
the Society of Petroleum Engineers ("SPE"), has reviewed and
approved the technical disclosures in this announcement.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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