Ambassador Oil & Gas (ASX: AQO) could be on track to enjoying early success with its first exploration program, with the Shocking-1 well in the Cooper Basin encountering good oil shows.
The company and partner Senex Energy (ASX: SXY) are now preparing to carry out a drill stem test to acquire the oil shows in the first primary target, the McKinlay Formation.
Oil shows were also noted in another primary objective, the Murta Formation.
Shocking-1 is currently at a depth of 1394 metres and drilling is expected to resume towards the planned total depth of 1700 metres once drill stem testing is completed.
The Shocking-1 well is located just 1.8 kilometres north of operator Senex’s producing Vintage Crop-1 well and 65 km southeast of the Moomba oil and gas processing facility.
This allows the well to be commercialised quickly in the event of a success.
Considerable upside also exists at Shocking-1, with the structure mapped at holding potential recoverable oil of more than 500,000 barrels from the Murta, McKinlay and basal Birkhead/Hutton formations, all well-known oil producing horizons in the Cooper basin..
The Century Rig 3 is expected to take about 14 days to drill the well.
Following testing, it will then move to drill the second Ambassador well, Kruger-1, which targets 380,000 barrels of oil.
Under the farm-in agreement, Ambassador will pay 100% of drilling costs to earn a 60% interest in each successful prospect. Senex holds the remaining 40%.
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