AWE updates Oi-1 drilling

AWE Ltd., as operator of Petroleum Mining Permit 38158 offshore Taranaki, New Zealand, advises that challenges in managing near-surface unconsolidated formations has resulted in abandoning the Oi-1 exploration well and the start of a new well, Oi-2, from an adjacent location.

Offshore staff

SYDNEY, AustraliaAWE Ltd. (ASX: AWE), as operator of Petroleum Mining Permit 38158 offshore Taranaki, New Zealand, advises that challenges in managing near-surface unconsolidated formations has resulted in abandoning the Oi-1 exploration well and the start of a new well, Oi-2, from an adjacent location.

The semisubmersible drilling rigKan Tan IVhas been moved to the new well location, and preparations were being made to begin drilling.

Oi-1 well was drilled to a planned depth of 1,507 m (4,944 ft) in a 17½-in. hole. Installation of a 13-3/8-in. casing was not completed due to wellbore instability at a shallow depth. Subsequent attempts to side track the well were unsuccessful and, consequently, the joint venture decided to abandon the well.

AWE has revised the drilling program for Oi-2 to mitigate risks of near surface wellbore instability and then continue the program as previously planned. A 17½-in. hole will be drilled to a shallower depth of approximately 550 m (1,805 ft) and a 13-3/8-in. casing will be set to enable a drilling fluid system to be established and improve management of conditions in the wellbore. A 12¼-in. hole will then be drilled to 1,500 m (4,921 ft) before a 9-5/8-in. casing is set. An 8½-in. hole will then be drilled to a planned target depth of 3,881 m (12,733 ft).

The Oi-2 exploration well is 12 km (5 mi) northeast of the Tui Area oil fields in water depth of 120 m (394 ft). The well objective is to evaluate the hydrocarbon potential of a four-way dip closed structure similar to the producing Tui, Amokura and Pateke fields, and will target the same F10 reservoir sandstones.

06/10/2014

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