G2 assessing oil potential in offshore Newfoundland license
NU-Oil and Gas has issued an update on its option agreement on the EL1070 license offshore western Newfoundland with G2 Energy Corp.
G2 has completed its due diligence on the lease: under the agreement, it has an exclusive option to earn 100% of NU-Oil’s working interest in the Deep Rights, with the latter’s subsidiary Enegi Oil retaining a 5% gross overriding royalty should the option be exercized.
Currently G2 is proceeding with work required to submit an application for a significant discovery license on EL1070, and must within 24 months of Dec. 16, 2016 achieve a flow test for hydrocarbons on one or more of the wells on the lease, in accordance with regulatory terms.
G2’s analysis of data on wells drilled on the license has led it to identify a potential bypassed oil pay zone behind casing in one of the wells within the Carbonate Platform section.
Subject to regulatory approval, it plans to flow test this prospective zone which is interpreted to have a dense natural fracture network in brittle carbonate rocks, with potential for natural flow capability.
G2 is an investment vehicle led by George Langdon and Gerard Edwards, respectively a former senior geologist and financial analyst at Mobil Oil.
The Deep Rights on EL1070 are defined as all petroleum substances and associated rights within and stratigraphically below the Ordovician Carbonate Platform (excluding Cape Cormorant and Table Cove formations).
The main target is the Shoal Point prospect, which is thought to be reachable from an onshore location.