Mixed results for Greenland drilling campaign

Cairn Energy has issued an update on its exploration drilling program offshore Greenland.

Offshore staff

EDINBURGH, UK -- Cairn Energy has issued an update on its exploration drilling program offshore Greenland.

The Alpha-1S1 well has reached an intermediate depth of 4,358 m (14,298 ft) in volcanic sections. Following extensive logging operations, the well is being deepened, having encountered gas shows in silty and volcanic sections over several hundred meters.

Oil also has been observed intermittently over a 400-m (1,312-ft) section in the well’s volcanic and volcano-clastic intervals. According to Cairn, this warrants further evaluation.

Geochemical analysis of recovered hydrocarbon samples, conducted by independent UK laboratories, has confirmed the presence of two oil types with different origins and levels of maturity. Further analysis continues.
The T8-1 well, which encountered gas in thin sands last month, reached a TD of 3,250 m (10,663 ft), but was not commercial. The well has since been plugged and abandoned, with the majority of the well costs of $84.2 million (excluding demobilization costs) written off, in accordance with Cairn's accounting policies.

Currently, the T4-1 exploration well is drilling ahead at a subsurface depth of 1,900 m (6,233 ft), at a location over 100 km (62 mi) north of Alpha and T8.

CEO Sir Bill Gammell said, “The T8, Alpha and T4 wells are the first wells in Cairn’s exploration program in Greenland and are also the first wells ever drilled in the Baffin Bay basin which is similar in size to the North Sea. The presence of both oil and gas confirms an active, working petroleum system in the basin and is extremely encouraging at this very early stage of our exploration campaign for the Sigguk block and the entire area.”

09/21/2010

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