Cairn reviewing exploration options off Greenland

Cairn Energy aims to drill its first well offshore Greenland in 2011.

Offshore staff

EDINBURGH – Cairn Energy aims to drill its first well offshore Greenland in 2011. The company’s Capricorn subsidiary, which operates or participates in various blocks and licenses, is reviewing options for a rig to drill in the Baffin bay basin.

According to Cairn, evaluation of Greenland’s prospective geological basins remains at a very early stage, with only six offshore wells and one onshore well drilled to date, five of those in the 1970s. However, analysis of the wells confirmed the presence of all elements needed for a working petroleum system.

Capricorn operates two Disko West blocks in the undrilled Baffin bay basin, in partnership with Nunaoil. So far 14 significant leads and prospects have been identified across the acreage.

Analysis suggests that with reasonable source rock thickness and quality, the kitchen for the Disko area could have generated hundreds of billions of barrels of oil. Assuming a trapping efficiency of a few per cent, the identified structures might be fully charged on an un-risked basis.

The partners have commissioned a controlled source electromagnetic survey (CSEM) over the blocks, along with well site surveys, and gravimetric, environmental and ice management surveys. The aim is to rank the identified leads and prospects and to provide a prospect and operational risk assessment.

Further data could be acquired next year. A drilling project team has also been assembled to initiate plans for a campaign of wells starting 2011.

In another permit offshore South Greenland, Capricorn and Nunaoil acquired reconnaissance seismic in 2008. The results confirmed a rifted continental margin and for the first time identified new prospective geological basins and sub-basins.

The seismic also highlighted numerous different potential play types, some similar to those proven on the adjacent Canadian coast. In September, the partners plan to acquire a 3,600-km (2,237-mi) infill 3D survey over the chief areas of interest.

Elsewhere, Capricorn was awarded a prospecting license earlier this year over Greenland’s east coast. Currently it is acquiring up to 4,000 km (2,495 mi) of regional 2D seismic along the coast aimed at identifying new basins.

In West Greenland, Capricorn is a partner to operator Encana in the Lady Franklin and Atammik blocks. A CSEM survey here revealed resistivity anomalies over some of the mapped prospects and leads. The data is being incorporated into assessments of the prospects – a decision on committing to the next phase of the license, including drilling, must be taken in the next six months.

08/25/2009

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