On the 14 August 2017, The Board of Sun Resources NL (“Sun” or “the Company”) announced that the Company and Pinnacle Exploration Pte Ltd (“Pinnacle”) secured a new oil project through bidding on open acreage in the inland waters of the State of Louisiana, USA. The parties have named the field “Bowsprit”.
Details of the Louisiana Oil Lease
Sun and Pinnacle have executed formal lease documents with the State of Louisiana and have been awarded two Petroleum Leases, covering a totoal of 1,154 acres in the Breton Sound Area of Louisiana. Consistent with an MOU between the parties previously executed, the Leases interests are on a 50/50 working interest basis. Sun paid 100% of the initial leasing costs of approximately A$350,000 in total.
The Leases are located approximately 70km southeast of New Orleans in approximately 10ft of water. There are 16 historical wells, drilled between 1952 and 1982, within the Leases and extensive existing 2D and 3D seismic over the Leases. The Leases are near the boundary of St Bernard and Plaquemines Parishes that covers the transition zone from onshore to the federal waters offshore Louisiana. The two Parishes have produced a combined 1.2 billion barrels of oil and 5.2 trillion scf of gas since 1978. The area is a prolific hydrocarbon province with over 1,800 wells drilled in the St Bernard parish alone.
Sun and Pinnacle have conducted extensive internal work assessing the project, based on public domain and purchased data. Sun has had two independent consultants review the project and verify its potential, and RISC Avisory Ltd has probabilistically estimated the potential of the field. Sun and Pinnacle have also prepared our own estimates and the information included on this website is predominately Sun’s assessment.
Bowsprit is assessed to contain an undeveloped conventional Miocene aged oil sand at a depth of approximately 7,400ft (2,255m) that is located above a deeper 9,500ft gas field that was developed in 1960s by Shell and produced through to 1990s. Consequently, the Bowsprit field contains 14 vertical well penetrations and has demonstrated producible oil. The 20 to 50ft thick oil sand was flowed successfully from two wells and produced approximately 75,000 bbls of oil, but was not of commercial significance at the time (~40 bopd). The deeper gas field was abandoned and the area relinquished by the former owner in the 1990s prior to the advent of horizontal drilling.
Sun has determined that the Bowsprit structure can be developed with up to five horizontal wells and could potentially be produced through a simple unmanned production platform. Saratoga Resources drilled and produced a 750ft horizontal well in an analogous quality, albeit thinner sand, 12km south of Bowspirt. Sun anticipates drilling wells with longer horizontal sections in a thicker column of oil in Bowsprit.
To prove the Bowsprit field potential, the Joint Venture is targeting drilling an appraisal well in the last Quarter of 2018. Sun intends to continue development planning while attempting to farm-out for the first well. It is anticipated that the full field development and first oil could commence in 2019.