Drillsearch Energy Limited has provided a drilling update for the Searcy-1 oil exploration well and the expansion of the PEL 91 Joint Venture drilling programme. Drillsearch holds a 60% interest in the PEL 91 JV while Beach Energy as Operator holds 40%.

Searcy-1 drilling results

The primary target of the Searcy-1 well was a potential oil accumulation in a Birkhead Channel in upper Birkhead Formation sands. Searcy-1 encountered oil shows on mud logs over a 3 metre interval in low quality Birkhead Formation sands. Following evaluation of the results from wire line logs the PEL 91 JV has determined that the Birkhead oil shows encountered at Searcy-1 are not commercial and therefore the well will be plugged and abandoned.

Expansion of the PEL 91 drilling program

Following the highly successful PEL 91 Western Flank Oil 5 - well drilling program, the PEL 91 JV is in the process of agreeing the expansion and continuation of the program with additional exploration, appraisal and development drilling. The JV is in the process of determining additional appraisal and development drilling locations for both the Hanson New Oil Discovery (up to 1 million bbls recoverable oil - gross) and the Bauer New Oil Discovery (up to 2 million bbls recoverable oil - gross).

In addition, the JV is also considering other additional appraisal, development and exploration drilling locations within the existing Modiolus 3D seismic. The first of these new exploration wells will be at Knights-1 which will target the major Birkhead Formation Channel located due south of the Arno-1 New Oil Discovery targeting recoverable oil of 900,000 bbls (Mean) up to 2 mmbbls (High) gross recoverable oil.

It is anticipated that the second stage of the expanded drilling program will commence in the December quarter 2011. Following completion of the Searcy-1 drilling operations, the Ensign-18 rig will be released to another operator for a 4-well drilling program. The PEL 91 JV has options with Ensign Drilling, the current drilling contractor, to fulfil an expansion of the PEL 91 drilling program.

Managing director Brad Lingo commented: "This drilling program has produced great results for Drillsearch with 4 new oil filed discoveries out of 5 wells drilled with 2 major discoveries at Hanson and Bauer. What is even more exciting is that every well in this program encountered oil in the Birkhead Formation sands. This has given the PEL 91 JV increased confidence and focus on the Birkhead Formation play and this is being followed up directly with the Knights-1 well."

Mr Lingo continued: "The results of the Western Flank Oil drilling program go straight to the heart of meeting our business objectives for FY 2012 - increasing reserves, increasing production and increasing cash flow. With Hanson scheduled to commence production by early October and Bauer and the other discoveries to quickly follow after that we see this as directly delivering those results."

Tags: Drillsearch Energy