🕐13.10.10 - 02:27 Uhr
Kairiki Energy - Market Update
ASX Announcement
13 October 2010
Market Update
The Directors of Kairiki Energy Limited ("Kairiki") is pleased to provide
the following update on the current activities of the Company.
Tindalo Sidetrack Program
As previously announced by the Operator, Nido Petroleum (Nido), the
following has been advised:
an initial acid soak was completed following which flow rates of
approximately 3,000 barrels of oil per day were observed at less than 1%
water cut and a flowing tubing head pressure (FTHP) of 27psi;
a second acid soak was undertaken and demonstrated a productivity increase
to approximately 5,000 barrels of oil per day at less than 1% water cut and
a FTHP of 57psi;and
a further third acid soak was completed on the Tindalo-1ST1 well using the
coiled tubing unit.
Following this stimulation, well productivity increased
further with maximum flow rates of 9,000 barrels of fluid per day, on
natural flow, with an average water cut of approximately 50%.
Nido has now provided the Company an update as follows:
equipment and personnel are being mobilised to determine the source of the
water into the sidetrack completion and prepare for any remediation to
follow.
The actual remedial activities undertaken will depend on the
results of the diagnostic tests which are expected to be undertaken in the
coming days.
If remedial action is unsuccessful the Joint Venture has a
number of further options available to it within SC54A including moving the
rig to Yakal, but has not yet made any decision;
the well is currently producing on natural flow due to the current
unavailability of the ESP pump at between 4,000 to 6,000 barrels of fluid
per day with an average water cut of 70%.
In the event that the remedial
work is successful and water ingress is significantly reduced, testing of
the sidetrack may resume at a natural flow rate; and The crude inventory
stored in the FSO as of 11 October 2010 is 32,451 barrels (net share --
9,768 barrels).
Service Contract 54B
Nido has advised that preparations are progressing for the drilling of the
Gindara prospect within the first half of 2011.
Long lead items for the
drilling campaign are being acquired and a search for drill rigs has
commenced.
Potential Farmout Update
Kairiki refers to previous announcements on its search for a strategic
partner to farm out its interest in SC54B.
As an update to that strategy,
Kairiki advises that it is in advanced discussions with a significant oil
and gas company in relation to Service Contract 54 Block B.
The discussions
whilst advanced remain confidential and incomplete.
Kairiki stresses that there is no guarantee that any final agreement will
be reached despite these ongoing discussions.
Furthermore if any agreement
is entered into it will be conditional upon any necessary third party
consents and approvals from the Department of Energy in the Philippines.
Kairiki will keep the market informed of any material development
concerning this matter and in relation to its strategy generally.
To read the full announcement please click here.
http://www.stocknessmonster.com/news-item?T=8bgc8iCo8YStYjiByY3k6B&E=ASX&S=KIK&N=509196
For more information please contact:
Dr Mark Fenton
Managing Director
Kairiki Energy Limited
Tel: 61 (8) 9388 6711
James Harris
Professional Public Relations
Tel: 61 (8) 9388 0944
Corporate Profile
Kairiki Energy is an Australian Based junior international oil and gas
exploration and production company focussed on the Philippines.
Kairiki
holds a 30.1% interest in Service Contract 54A and a 40% interest in
Service Contract 54B.
SC 54A measures 862 km2 and contains the Tindalo, Yakal, Nido 1X1 and
Signal Head oil discoveries and a substantial portfolio of similar low-risk
reefal prospects.
In December 2009, Kairiki announced that the SC 54A Joint
Venture had approved the development of the Tindalo field.
Based on a
successful development at Tindalo a number of follow-up developments may be
considered in SC 54A.
SC 54B measures 3184 km2 and contains the Gindara prospect which has a mean
unrisked oil in place volume estimated by the Operator, of 634 million
barrels.
The Gindara prospect is a very large simple four-way closure at
the Top Nido Limestone reservoir objective with an areal extent of 28 km2,
a vertical closure of over 300m and is well located to receive hydrocarbon
charge from the Palawan Trough.
Kairiki is seeking to farm down its
interest in SC 54B to accelerate drilling of the Gindara prospect.
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