AWE Limited (ASX: AWE) advises that the PMP 38158 (Tui) Joint Venture has approved the drilling of two additional wells in the second half of 2013:
· the Pateke-4H infill development well; and
· the Oi exploration well.
AWE, as the Operator, has entered into an agreement to secure the recently overhauled and upgraded Kan Tan 4 semi-submersible rig, operated by Frigstad Offshore, to drill both wells as part of a larger drilling campaign to be undertaken by other companies in New Zealand during 2013-14.
The Pateke-4H infill development well will target a mapped northern extension of the Pateke Field (part of the Tui field group) that is not being accessed by the current producing well, Pateke-3H.
The well is planned to be drilled to a total measured depth of approximately 6,900m and will include a 2,500m horizontal section.
AWE estimates that Pateke-4H could increase field recovery by 2.3 million barrels (gross). AWE has previously booked its equity share of a Contingent Resource (2C) recoverable volume of 2.0 million barrels associated with this opportunity.
Subject to confirmation of results from the Pateke-4H well, a project to connect the well to existing infrastructure is expected to be confirmed at which point AWE would anticipate booking Reserves (in place of Contingent Resource) associated with the Pateke-4H development project.
The Managing Director of AWE, Mr Bruce Clement, said that the infill drilling plans would, if successful, enhance the production life of the Tui Oil Fields.
“Tui has been a valuable production asset for AWE and on current projections will continue to produce through to late 2020.
“The Pateke-4H infill development well has the potential to deliver significant production enhancement to the Tui project,” Mr Clement said.
Drilling and completion of Pateke-4H is planned for 2013-14, subject to rig timing. If successful, Pateke-4H will be tied-in to the Tui Field Floating Production, Storage and Offloading vessel (FPSO) utilising existing subsea infrastructure and commissioned in 2014-15.
The Oi prospect is a 4-way dip closure created by compactional drape over an underlying basement high, similar to the structures at the Tui, Amokura and Pateke Fields, and is targeting the same producing reservoir level (F10 sandstones). Located 13km to the northeast of the Tui Field FPSO, the Oi prospect represents a Prospective Resource of 11 million barrels of recoverable oil (gross, P50 estimate).
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