Oilex Commences Drilling Program in Oman

Source: www.gulfoilandgas.com 1/2/2008, Location: Middle East

Oilex Ltd advised that the Sarha-1 exploration well was spudded on 31 December 2007. The well is the first of three exploration wells which will be drilled in a continuous sequence by Oilex in the Block 56 Production Sharing Contract Area, Sultanate of Oman using the Abraj Rig 204.

Sarha-1 exploration well was spudded on 31 December 2007. Current operations are drilling ahead in 121/4” hole at 242 m. Surface casing had been set in the period prior to arrival of the Abraj rig to expedite the program. Drilling operations are planned to take 18 days and total depth is expected to be reached at a depth of approximately 1650m.

Oilex has been pursuing an aggressive exploration program in Oman since the award of Block 56 to the Oilex-operated joint venture in July 2006. In that time, Oilex has developed a significant operating capability within Oman with capacity to execute a major drilling campaign on behalf of the joint venture.

The Sultanate of Oman was chosen by Oilex and its partners as a Middle East country with a demonstrated and prolific hydrocarbon production history, a stable Government and a well developed and accessible hydrocarbon evacuation infrastructure. The Block 56 joint venture brings together a strong team of companies with the capacity and experience to bring a potential discovery in the area into production in a short timeframe, with Oilex as operator.

With the establishment of a strong local presence in Muscat, complemented by Oilex’s experienced technical and management team based in Perth, a fast pace of exploration has been maintained. To date a significant volume of existing seismic data has been reprocessed and during 2007 a large program of new 2D seismic data was acquired. On the basis of the reprocessed data and existing 3D seismic surveys in the western part of the block, a number of exploration well locations were developed for drilling during 2008. The first of these wells is Sarha-1, located on the eastern flank of the South Oman Salt Basin adjacent to several producing fields.

Block 56 was awarded to the partnership after a competitive bidding round, the first in Oman’s history. The Block was ranked highest of all Blocks on offer by the joint venture partners. The Block is located on the eastern flank of the south Oman salt basin, an area which has already seen significant exploration success and subsequent production. Several of the fields in this area hold over 500 million barrels of oil in place. Most of these fields were discovered by Petroleum Development Oman (PDO) during the last 20 years. The Sarha prospect is similar in its structural form and reservoir objectives to the nearby producing fields operated by PDO. The pipeline network from those producing fields in the main part of the South Oman Salt Basin is only about 30 km to the west from Sarha-1.

The well is planned to evaluate the prolific Permo-Carboniferous reservoir interval which is a major productive horizon across Oman. In addition the well will be deepened to intersect the prospective Cambrian Huqf Formation which has been found oil-bearing in adjacent wells.

The Sarha-1 area is covered by a modern 3D seismic dataset and should the well prove successful this will aid in expediting field development activities. Shallow, low cost wells in an area of known oil accumulations located in close proximity to infrastructure make this an attractive region in which to explore.

Sarha-1 will be followed by Ghadaq-1 in the western province of conventional plays and Alyanbou-1, in the frontier area on the northern salt wall trend. Four wells are planned for Q3 2008 on locations that will depend to a large extent on the results from the initial 3 well program and a further 4 wells are anticipated to be drilled in late 2008 and Q1 2009.


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