Thailand
(50% Interest)
L20/50 Block
The L20/50 block is located in the southern portion of the Phitsanulok Basin and is 3,947 km2 in area and has been very lightly explored. The Phitsanulok Basin contains the largest onshore oil and gas accumulation in onshore Thailand, the Sirikit Field, with reserves in excess on 200 million barrels of oil equivalent ("mmboe"). Current daily Sirikit production is 20,000bo, the Company received Notice of Qualification to Bid from the government in early September 2007 and in late December 2007 was advised of the successful tender for L20/50. The Company with Carnarvon Petroleum accepted the block award from the government at the official signing ceremony in Bangkok on 21 January 2008.
Carnarvon, as operator of the L20/50 block, is applying a similar exploration philosophy to exploration on the block in a basin that is a direct geological analogue to the nearby Phetchabun Basin where recent exploration by Carnarvon in the environs of Wichian Buri has been extremely successful and resulting production is now averaging 6-8,000bopd after peak rates around 15,000bopd.
Technical studies undertaken by the Joint Venture have determined the existence of a mature oil source kitchen in the deepest basinal areas adjacent to the identified leads, and have also demonstrated the potential for tacked volcanic reservoir targets in the leads as per the adjacent Phetchabun Basin where Carnarvon and Pan Orient have announced significant new oil discoveries in the “volcanic play”, reporting a recoverable resource in excess of 40 million barrels from a number of new oil pools in the volcanic play.
The technical studies have confirmed that all previous exploration wells in the permit are “off-structure” mainly on deeper sandstone plays as per the Sirikit Oil Field, due north of L20/50, and are therefore not valid tests of this play. Despite the record of oil and gas shows in the Nong Bua-1 well, it too has been shown to be sufficiently beyond closure to warrant twinning of the well at this location until further seismic has been run to further delineate the prospect’s target sandstone reservoirs.
Seismic Interpretation Completed
Carnarvon Petroleum, as operator of the L20/50 permit, has completed interpretation of the 550 kilometres of 2D seismic data acquired late last year by the Carnarvon Petroleum (50%) and Sun Resources (ASX: SUR) (50%) Joint Venture. This seismic is of good depth penetration forming a broad grid of lines approximately 1 km apart over the most prospective part of the licence.
Results of the Interpretation
Interpretation of the seismic has identified five substantially different prospective styles (play types) being (1) basin margin antithetic fault blocks (akin to the Sirikit Oil Field style structuring), (2) lacustrine fans which may contain sandstone reservoirs deposited via river channels, (3) elevated large horst structures, (4) buttress fault traps (akin to the Na Sanun structure) and (5) possible volcanic intervals indicated by bright seismic amplitudes.
Within these five play types 23 leads have been identified, of which five to six have been high graded. The high graded prospects will be presented to the Joint Venture over the coming weeks to determine which three will be prioritised for the 2010 drilling programme. There is one firm well and two contingent wells to be drilled in the fourth quarter of 2010.
Interpretation of data from the previous three wells drilled in the licence and the addition of the new seismic indicates that the basin is deep enough to generate oil. In support of this, oil shows were recorded in Nong Bua-1 within thin sandstone reservoirs in three intervals at depths of 2,456 metres, 2,743 metres and 3,086 metres within the central part of the basin.
2010 Drilling Programme
The operator considers that to properly evaluate the licence, up to three new wells maybe required into three different play types. Carnarvon has commenced work on an environmental impact assessment (EIA) for the approval of nine drilling locations for 2010 and 2011 from which three will be chosen for a 2010 drill programme of one firm well and two contingent wells.
The Joint Venture has commenced planning for drilling in fourth quarter of this year, subject to granting of appropriate government and environmental approvals. This timing takes into account the lead time required to obtain environmental approvals and to subsequently prepare the drill pads. Due to the lead times involved, nine drill locations are being submitted for environmental approval which will provide maximum flexibility to the Joint Venture’s 2010 and 2011 drilling programmes.