The latest quarterly reports from the oil and gas players with stakes in the highly prospective Perth Basin indicate strengthening prospects on the back of a rising oil price and planned joint venture activity.
The latest quarterly reports from the oil and gas players with stakes in the highly prospective Perth Basin indicate strengthening prospects on the back of a rising oil price and planned joint venture activity.
Earlier this month, exploration partners ARC Energy and Origin Energy announced the discovery of oil at the Centella-1 well off the Western Australian coast, and are optimistic the field is of commercial size.
ARC managing director Eric Streitberg said the location was interpreted to be in a gas-prone portion of the Centalla licence, and so was very encouraged to find oil
But it would be necessary to wait for the results of further production tests to estimate long-term flow rates and volume reserves, he said.
“This discovery has the potential to now open up additional targets in the area that may also contain oil,” Mr Streitberg told WA Business News.
“This is the fifth exploration well to be drilled in the 3D seismic grid, the fifth to establish the presence of hydrocarbons and the fourth to be productive.”
Drilling and initial testing of the Xyris South 1 exploration has also proven promising, resulting in a substantial gas column.
Approvals for the Denison 3D seismic survey are almost complete with the program set to commence in the next few weeks.
ARC’s quarterly report says continued strong production and oil process contributed to record oil and gas sales receipts for the quarter of $24.3 million. A record profit of $20.1 million was announced for the year ended June 30 2004.
The Hovea and Eremia fields produced a record 3.3 million barrels of oil for the quarter, with the drilling of Hovea-11 bringing production at rates of up to 2,500 of oil a day.
Meanwhile Roc Oil, Wandoo Petroleum, Voyager Energy and others will drill up to six wells in the fully funded offshore Perth Basin.
Three exploration wells have been confirmed on Fiddich-1, Hadda-1 and Flying Foam-1, which were selected from 3D seismic.
The Blue Jacket-1 exploration well will also be drilled pending the results of 2D seismic. A further two development wells are planned for the Cliff Head oil field.
“We are finally overcoming the tight market for offshore drilling rigs and have a big drilling program ahead,” Voyager Energy managing director John Begg told WA Business News.
“It will be our first drilling program on large targets offshore selected using the 3D seismic technology that is proving so effective onshore in the Perth Basin.
Operator of the Cliff Head oil field, Roc Oil, said the project had boosted pre-development work on the Front End Engineering Design, marketing and environmental studies and geological and engineering modelling.
However, Roc has indicated that final project costs may be 20 per cent higher than expected due to higher costs in the upstream fabrication sector, although it was expected this would be offset by the significantly higher oil prices.
Roc Oil was one of the main players responsible for starting the Perth Basin renaissance when it made the first commercial oil discovery at Cliff Head.
