New Guinea Energy (ASX: NGE) is an Australian company focusing on oil and gas exploration and production in Papua New Guinea. The company holds six onshore Petroleum Prospecting Licences which contain an exploration inventory of 101 leads and prospects.
New Guinea Energy reports Panakawa-1 exploration well at 2,424m
New Guinea Energy (ASX: ) has reported that the Panakawa-1 well in the Magobu Formation was at a total depth of 2,424m MD at 0700 PNG time, and in the process of completing a logging and sampling program.
The Panakawa Prospect is an oil prospect located in PPL 267 in Papua New Guinea and was initially identified as a lead from the Yalis Phase I Seismic Survey completed in 2006, and further delineated by the Yalis Phase II Seismic Survey (Q3 2008).
In a statement the company said despite the presence of elevated gas readings in a number of intervals, pressure tests have indicated that the target reservoirs contain water.
The well encountered well-developed reservoir sands in the Alene Formation in excess of 57m net reservoir averaging 22% porosity. Reservoir quality sandstones were also present in the Toro Formation within a gross interval totaling 67m.
Petrophysical analysis indicates residual gas saturations of 5-10% in the Alene Sandstone indicating a residual gas accumulation or a transition zone below a nearby gas-water contact.
The well was drilled in a slightly off crestal position with limited updip potential for a significant gas cap. Residual gas was also noted in the Toro Sandstone suggesting a combined Alene- Toro historical gas column of up to 150m.
In general, most well developed reservoir sands appear flushed, but residual hydrocarbons persist in the poorer quality sands. Log analysis suggests intermittent zones of immovable hydrocarbons persist across the Upper Imburu Formation.
Michael Arnett, executive chairman, said these intervals will be sampled for further geochemical analysis to ascertain the hydrocarbon charge history to assist in future exploration within this licence.
The overall cause of failure of the Panakawa Prospect is the lack of trap integrity due to apparent fault leakage. Hydrocarbons originally trapped at the Panakawa Prospect have not been preserved in commercial quantities.
However, due to the residual nature only of the hydrocarbons, the Panakawa-1 well will be plugged and abandoned after the completion of the current logging and sampling activities.
NGE has obtained a number of positive outcomes from Panakawa-1 including the confirmation of thick, high quality reservoir sandstones at relatively shallow depths and evidence of significant hydrocarbon charge over a number of intervals.
In additon the Alene and Toro sands have high porosity yielding residual hydrocarbons and the residual gas is spread over a 150m interval which suggests a valid trap with a significant hydrocarbon column existed in the past.
NGE said it still considers PPL 267 to contain significant prospectivity that can be assessed with relatively low-cost follow up seismic acquisition and drilling.
NGE will now reprocess existing seismic data in the block to incorporate the results of the seismic velocity data obtained from the well.
Plans for additional seismic acquisition will be accelerated to extend the data to the southeast towards the hydrocarbon source kitchen as well as to advance evaluation of the Panakawa North Lead before undertaking additional drilling activities.
New Guinea Energy is the sole participant in the Panakawa-1 well as the holder of a 100% interest in PPL 267.
