KAROON Gas Australia has received the go ahead from the Brazilian oil and gas regulator advising that Karoon’s revised appraisal plan for its 60 per cent owned Santos basin blocks has been approved.
Paving the way for the joint venture to finalise and prepare for the forward work program, the revised appraisal plan specifies the minimum firm and contingent work program commitments.
All firm commitments are to be completed by the 31 December 2018.
Two wells expected to be drilled in the Emu/ Echidna area, Karoon is also expected to carry out acquisition and processing of a 3D seismic survey over the acreage, to complete pre-stack depth migration of data in 2 millisecond frequency and undertake further processing of data to increase frequency and resolution.
The contingent work program period will start on 1 January 2019 and consists of drilling up to four contingent wells.
Each well drilled will result in a six month extension to the contingent period.
Karoon expects to commence appraisal drilling of the Echidna light oil discovery in 2016 and will install an early production system on the Echidna field contingent upon continued appraisal drill success at Echidna.
An early production system will likely consist of two or more production wells which are expected to provide technical information about reservoir production performance and would form the basis for commencement of a full field development.
Karoon said the 3D seismic survey included in the appraisal plan will allow better risking and ranking of other prospects in the blocks.
It is expected that upon exploration and appraisal success additional resources would be tied back to a centrally located floating production, storage and off-loading vessel, the company said.
Karoon managing director Robert Hosking said the work program and appraisal success at Echidna and Kangaroo would underwrite the company’s ambitions of transitioning into a development and production company.
“The approval of the revised appraisal plan is significant for the company. Karoon is now in a position to move forward and contract a drilling rig to commence the next iteration of the work program during 2016,” he said.
Pacific Exploration and Production owns the remaining 35% interest in the blocks, which are S M 1037, S M 1101, S M 1102, S M 1165 and S M 1166.