Roxi, the Kazakhstan focused exploration and production company, has announced a detailed operational update. In particular, it reported that oil shows had been encountered whilst drilling the NK22 well on the Galaz contract area of the NW Konys Field.
Roxi Petroleum is a small-cap oil exporation and production company listed on AIM in London (AIM:RXP). Its main assets are the BNG, Ravninnoe, Galaz, Beibars and Munailly blocks in Kazakhstan. Roxi indicated that its strategy remains to focus on its existing assets to secure early production and to prove up reserves and at the same time, building successful partnerships from its recent farm-outs.
The CEO, David Wilkes said:
"Roxi has made excellent progress across its portfolio as we look to deliver our strategy of securing early production and proving up reserves; whilst building on the relationships and partnerships that we have already forged.
Galaz
The original announcement of the spudding of this well stated that the target depth was 2,200m with the target formations being the Arksum Sands and Upper Jurassic. These are the formations that have been targeted by the earlier production wells on NW Konys.
They have now indicated that they have seen "shows" in these formations and are drilling ahead at 2,550m in the middle-Jurassic. The new ultimate target depth is as yet unknown.
It may be reasonable to conclude that the shows in the Arksum and Upper Jurassic will end up being commercial, and may well add to the reserves already declared on the block. It remains to be seen if the deeper exploration target will find anything, let alone be commercial, but if it is, it could add substantial value to the Galaz block. Interestingly, Roxi have been silent on the progress of negotiations with third parties on the full or partial sale of this asset.
Ravninnoe
Roxi have released further details of the initial results from the drilling of Well #20 on the Ravninnoe contract area. They have confirmed the hydrocarbons found are oil at high pressures (likely to lead to higher flow rates in the future), and that they have not encountered any H2S issues. Porosity has been measured in the range of 4-20%. A workover rig has been mobilised to complete the logging and test the well. Hopefully further results will be released within the month.
