Oilex reports that the Miocene MBS reservoir has been successfully tested in Cambay-74 at a constrained rate of more than 500 bopd, in the Cambay-74 appraisal well. The well will be completed as an oil producer on conclusion of the test program.

• Cambay-74, the first new appraisal well to test oil in the Miocene MBS reservoir, flows oil at intentionally constrained rates of more than 500 barrels of oil per day (”bopd”) from a 7 metre test interval • Cambay-74 will be completed as an oil producer on conclusion of the test program • Discovery well Cambay-64 now flowing at more than 300 bopd with testing at higher rates to follow once storage capacity at site is increased • Balance of current Cambay drilling program to be re-designed to fast-track the development of oil production from the MBS reservoir and deeper EP III-IV and Basal EP IV oil zones • In addition to further development wells, a number of historic wells are being assessed for re-entry and completion at the MBS to fast-track daily oil production rates in the short term • The Miocene MBS, a relatively shallow horizon, will allow low cost and speedy development • The preliminary estimate of the volume of oil in place from the MBS horizon in this sector of the field alone is estimated to be in the range of 12 - 25 million barrels, not included in the previous published estimate of 48 million barrels of oil in place for the deeper objectives in the western sector of the field • Oil produced from Cambay-74 is already being transported to a nearby refinery and sold, along with the crude oil produced from Cambay-64

The oil is of high quality and has a gravity 380 API. It was tested through a 8mm choke with a flowing tubing pressure of 820 psi during the initial flow period at unstabilised rates of over 500 bopd. On conclusion of the initial flow period the well will be shut-in for pressure buildup. The formation pressure measurements indicate that the reservoir is at virgin pressure and has not been depleted by production from older wells in the north of the block, now shutin, that produced some gas from the MBS in the past. When the pressure build-up test is complete, the well will be returned to production and gradually opened up to establish the maximum sustainable production rate from the zone.

On the basis of this excellent result, the Joint Venture has made the decision to complete the well at this point so that it is kept as a producer, and also to re-design the balance of the Cambay drilling program. A Joint Venture meeting will be held in November to confirm the new program, the primary objectives of which will be to expedite the Miocene potential development in the Cambay Field. The hiatus in the drilling program will enable a variety of options to be evaluated for increasing production from the MBS, which has been a secondary objective in each of the wells drilled to date by Oilex, through workover and recompletion of old wells and drilling of new wells as well as formulating a plan for development of the deeper EP III-IV and Basal EP IV oil zones.

A cased hole drillstem test of well Cambay-74 over a perforated interval of 7 metres in the Miocene Basal Sand (MBS) has yielded a flow of more than 500 barrels per day of oil at a flowing tubing pressure of 820 psi on a 8 mm choke. During the initial flow period the flow rate was intentionally constrained to avoid possible sand production from the formation which has been observed in other Miocene reservoirs in the region of similar high quality sands. After the pressure build-up test is complete, the well will be returned to production and gradually opened up to establish the maximum sustainable production rate from the zone. The oil produced from this test at Cambay-74 is being transported to a nearby refinery and sold along with the crude oil produced from Cambay-64.

Cambay-64 has continued to produce oil with no water from a perforated interval of 2 metres at an average rate of 310 bopd on 5.6 mm choke at a flowing tubing pressure of 660 psi, a progressive improvement on the initial test rate of production that was reported on 20 October. The rate is currently constrained by available storage tank capacity at the well site and by tank trucks required to haul the crude to the nearest available offtake point. Shortly, once these logistics are resolved, the well will be flowed at higher rates.

The results from Cambay-64 and Cambay-74 have confirmed the commerciality of a new oil discovery in high quality basal Miocene reservoir sandstones that was historically bypassed. These sands are widely distributed in the Cambay block.

The MBS is an excellent quality reservoir and at a depth in this area of approximately 1400 metres, offers the potential for low cost development and early production from the Miocene which has now been proven by the results of both Cambay-64 and Cambay-74. The oil is very mobile having relatively high gravity and a moderate content of dissolved gas. The preliminary estimates of volume of oil-in-place indicate a range of 12 - 25 million barrels in this sector of the block. Recovery factors are likely to be in the range of 30% - 50% by analogy with other reservoirs of this quality in the Cambay Basin. Further detailed work is required to refine the range of resource and reserve. This estimate is in addition to the previous published estimate of 48 million barrels of oil in place for the deeper objectives in the western sector of the field.

Expansion of the production capacity of the Miocene in the western part of the Cambay Field is being evaluated through the potential to re-enter and complete existing wells for which wireline logs are available and through drilling of new wells.

In the case of re-entry and completion of existing wells in the MBS, the work is in progress to select wells that have indications of hydrocarbons in the MBS that were not tested and which can be re-entered. Three existing wells are being considered for recompletion as MBS producers in the western part of the field. These wells were all initially completed in deeper horizons, making recompletion to the shallower MBS relatively easy.

In the case of drilling new wells locations will be selected by the Joint Venture after detailed mapping of the relevant oil bearing zones. In both Cambay-64 and Cambay-74, a number of younger sandstone units above the MBS also appear to be oil or gas bearing and stratigraphic equivalents to these zones will be tested in the near term in other nearby wells.

Tags: Oilex