Our first well, 11/24b-4, on the Wick prospect has disappointingly not been successful. We have safely completed drilling operations and will now proceed to plug and abandon the well.
The 11/24b-4 exploration well has been drilled to a total depth of 1,000m. The objective of the well, the Beatrice Sandstone, was encountered at a depth of 933.5m but is water bearing.
Provisional petrophysical analyses indicate that the Beatrice Sandstone has a gross thickness of 22.8m with 19.8m of net sandstone of 17.2% average porosity.
The well had the highest risk in the Corallian portfolio with a pre-drill chance of success estimated at 30%, with trap integrity considered the greatest risk element, and this appears to be why the well failed. It was an exciting prospect with pre-drill Pmean Prospective Resources estimated at 26 million barrels of recoverable oil.
The 11/24b-4 well is Corallian’s first well as Exploration Operator and drilling operations have been completed safely, in an environmentally sensitive area with multiple stakeholders and complex regulations.
We look forward to drilling the Colter appraisal well and will update shareholders when drilling commences. We assess the pre-drill chance of success of the Colter well to be 58%. The pre-drill Pmean Prospective Resources are estimated at 23 million barrels of recoverable oil. Corallian holds a 49% interest.
We continue to make good progress with securing funding partners for two further wells in 2019, the Curlew-A appraisal well in licence P2396 and the Oulton West appraisal / exploration well in licence P2222.
Corallian as Exploration Operator for Licence P2235 is pleased to report that drilling of the Wick exploration well (11/24b-4) commenced at 00:45 hrs on 25 December 2018. The Ensco-72 drilling rig will be on location for approximately 3 weeks.
Corallian as Exploration Operator for Licences P2235 and P1918 is pleased to report that the Department for Business, Energy and Industrial Strategy, Offshore Petroleum Regulator for Environment and Decommissioning (OPRED) has completed its review of the Environmental Statements, the representations received from consultees and the additional information provided by Corallian for the proposed Wick and Colter wells. OPRED has advised the Oil and Gas Authority of its in-principle agreement to the issue of the relevant consent for both projects.
There are several regulatory approvals and notifications still required before the consenting process is completed for the wells. When all the necessary approvals have been obtained, the wells will be drilled as a back-to-back programme using the ENSCO-72 Jack-Up rig, and subject to the approvals being in place Corallian will commence the programme with the drilling of the Wick well during December 2018. Following completion of the Wick well, the rig will be mobilised from the Moray Firth to the English Channel to drill the Colter well.
Fraser Well Management Limited will be the Well Operator for the drilling of the wells. Orbis Energy Limited are the environmental consultant to the projects. No further announcements are planned by Corallian until all the approvals are in place and the drilling has commenced.
Corallian Energy Limited (Corallian) has signed a farmout agreement with Talon Petroleum (UK) Limited (Talon), a wholly owned subsidiary of ASX-listed Talon Petroleum Limited, for a 10% interest in Licence P2396 containing the Curlew-A discovery. Corallian is planning to drill an appraisal well of the Shell 1977 discovery 29/7-1, which found light oil in Tertiary Odin and Cromarty Sandstones within a salt-cored anticline. Talon will pay 15% of the appraisal well up to a cap of £12m and thereafter its licence interest share. The current estimated well cost, using a Jack-Up rig, is £9.7m which includes down-hole oil sampling.
The Curlew-A discovery well encountered net oil sands of 10.5m and recovered multiple 36° API oil samples. The anticline covers an area of approximately 21 square kilometres. The Curlew-A appraisal well, planned for H2 2019, will be drilled to a depth of approximately 2,700 metres sub-sea in a water depth of approximately 90 metres.
The appraisal well will also target a secondary objective in the Forties Sandstone, which was not encountered in the original discovery well but that may be developed in the southwestern flank of the structure where the appraisal well will be drilled.
A Competent Person’s Report (CPR) on Curlew-A was completed by Software Information Solutions, Schlumberger Oilfield UK (SLB) in October 2018.
The table opposite shows the Unrisked Contingent Resources assigned by SLB to Curlew-A on a gross basis.
Corallian acquired the licence in the 30th Seaward Licensing Round. The Company’s interest following the farmout will be 90%. The Company plans to farmout a further 50% interest in Licence P2396 on the same terms, retaining a 40% interest at drilling, paying 10% of the well costs.
Corallian Energy has signed a contract with UK based drilling contractor Ensco U.K. Ltd for the provision of the Ensco-72 jack-up drilling unit for its Wick and Colter wells.
The rig site surveys have been completed and the two well programme is expected to commence in Q4, subject to receipt of the necessary regulatory approvals and consents for both wells.