Oil and gas company Conrad Petroleum is preparing to drill an appraisal well at its Mako prospect located in the Duyung Production Sharing Contract, offshore Indonesia.
Duyung PSC is set in the Natuna Sea in water depths of 60-100 meters and associated shallow drilling depths of up to 2,000 feet. This license is surrounded by the West Natuna Transport System, with both gas export and oil production facilities located nearby.
The Duyung PSC includes the Mako shallow gas discovery which, according to the LEAP CPR, is estimated to contain 400 Bcf to 1.3 Tcf of gas in place.
Conrad Petroleum, the operator, in early April agreed with Empyrean Energy to sell up to 20 percent of its interest in West Natuna Exploration (WNEL), which in turn holds a 100 percent participating interest in the Duyung PSC.
By mid-May, Empyrean paid Conrad $2 million to acquire an initial 10 percent interest in WNEL and agreed an extension to the longstop date for a further $2 million in order to buy an additional 10 percent.
However, at the end of May, Empyrean gave up on the additional 10 percent interest, which left the company with a total of 10% interest in WNEL and consequently, the Duyung PSC.
Three previous wells drilled at Mako in 1975, 1996 and 1999 intersected the gas zones but were not flow tested. Two of these wells were targeting deeper oil and the third well, targeting gas, encountered technical difficulties and so no flow test was completed.
A new well on the Mako discovery, the Mako South-1 Well, is planned to spud by late June, targeting the IntraMuda sands. The objective of the well is to flow test the gas sands and provide key data on the permeability and gas saturation properties of the reservoir.
In a statement on Tuesday, Empyrean Energy CEO, Tom Kelly, said the company is expecting that the Mako project drilling will start “later this month to establish reservoir quality and conduct a gas flow test on the 430-650 Bcf conventional contingent gas resource.”
According to a recent update by Conrad, the well will be drilled with the COSL Seeker jack-up drilling rig, which headed under tow to its offshore location a week ago. The 2008-built COSL Seeker rig is owned by COSL Drilling.
Also on Tuesday, Empyrean placed 16,080,000 new ordinary shares of 0.2p each in the company at 3.5p raising £562,800 and exercised options in respect of 15,000,000 new ordinary shares of 0.2p each at an exercise price of 2p per option exercise share raising a further £300,000. In total, the company raised a total of £862,800 ($1.1M) to advance its portfolio.
Empyrean added it expects to spend $2.65 million for drilling and testing the Mako prospect.
Offshore Energy Today Staff