Oil & Gas Corporate News
Bowleven (LON:BLVN) (BUY, £3.00) (BLVN, 199.5p, ? (5.56%)) announced that the Sapele-1 exploration well drilling in the Douala Basin, offshore Cameroon has made two potentially significant hydrocarbon discoveries in Miocene reservoirs based on the results of drilling and initial wireline logs and pressure data. The first discovery, Lower Omicron, encountered light oil/gas condensate in moderate quality reservoir units. The second, Deep Omicron, encountered oil in high quality sands. This well was designed to intersect multiple stacked objectives through Miocene and Cretaceous horizons. As a result, it is believed to have penetrated the extremities of both Miocene prospects at sub-optimal locations. Consequently, given the extremely encouraging results it is likely sidetracks will be drilled to appraise both prospects at better locations. Based on the better than prognosed reservoir quality the revised preliminary in place volumetrics on a P90-P10 range are estimated to be for Lower Omicron 40-290MMbbl or, in the event that the hydrocarbons at that interval are determined to be gas condensate, 75-595Bcf, and for Deep Omicron 55-380MMbbl. These numbers remain provisional. Due to the stratigraphic nature of these prospects further appraisal will be required and is being planned. Wireline logging operations are ongoing over the Omicron reservoir objectives. Once completed, it is planned to drill to a total depth of approximately 4,450m to test further prospective horizons, including the deeper Cretaceous, a new play untested within this part of the Douala Basin. Drilling activity is expected to take a further 30 to 40 days, excluding testing. The forward plan will be reviewed on reaching the target depth and when the results from the additional targets are obtained. Meanwhile, planning for testing and sidetrack activities on the Miocene discoveries is underway.
Comment: Excellent news for Bowleven who confirms the attractiveness of its prime position in the Douala basin. Sapele-1 is a very important well for the Company and these preliminary results are very encouraging. We maintain our Buy rating and 300p price target.
Desire Petroleum (LON:DES) (BUY, £2.00) (DES, 119.75p, ? (11.66%)) announced that both regulatory and partner approvals have been granted for Desire to drill the 14/15-2 Rachel North well. The 14/15-1 well has been plugged and abandoned and the rig is currently waiting on weather to move to the Rachel North location. The Rachel North well…
