Perth, Mar 31, 2008 AEST (ABN Newswire) - Empire Oil & Gas N.L. (ASX: EGO)(PNK: EOLGF) and its joint venture partners in Petroleum Exploration Permits EP 416, EP 432 and EP 389, all located in the onshore Perth Basin, Western Australia, have commenced and completed all the surveying of the seismic lines and line clearing for Terrex Seismic Crew 401 which commenced recording the 50km 2D Wellesley seismic on 30 March 2008 in EP 416. The seismic surveys in EP 432 and EP 389 will follow sequentially.
The 3 separate seismic surveys which have commenced in the onshore Perth Basin are:
- Wellesley 2D Seismic Survey in EP 416, South Perth Basin
- Mullering 3D Seismic Survey in EP 432, North Perth Basin
- Gingin West 3D Seismic Survey in EP 389, Central Perth Basin
The participants in the Seismic Surveys are:
EP 416 Permit Equity Wellesley Seismic Survey -----------------------------------Empire Oil & Gas N.L. 75%Allied Oil & Gas Plc 20%ERM Gas Pty Ltd 5%-----------------------------------EP 432 Permit Equity Mullering Seismic Survey -----------------------------------Empire Oil & Gas N.L. 62.5%Allied Oil & Gas Plc 25%ERM Gas Pty Ltd 12.5%-----------------------------------EP 389 Permit EquityGingin West Seismic Survey-----------------------------------Empire Oil & Gas N.L. 62.5%Wharf Resources Plc 25%ERM Gas Pty Ltd 12.5%-----------------------------------
EP 416, 50km 2D Wellesley Seismic Survey - Wellesley Gas Prospect
The surveying of the seismic lines commenced on 13 March 2008 was completed on 22 March 2008 with Terrex Crew 401 commencing the recording on 30 March 2008. The 50km 2D Seismic Survey is to confirm structural integrity of the Wellesley anticlinal structure. The reservoir objective Permian aged Sue Coal Measures has the dimensions to potentially trap 150 billion cubic feet of recoverable gas at a depth of 3,700 metres. Joint venture partner, Allied Oil & Gas Plc, have the option to contribute $5,000,000 to drill the Wellesley-1 well earning a further 60% equity in EP 416. The Wellesley Gas Prospect is located adjacent the City and Port of Bunbury and encroaches into the Kemerton Industrial Area adjacent the Port.
The gas demand in the industrial satellites in the South West of Western Australia has seen natural gas prices firm substantially. The Bunbury-Kemerton industrial area is energy dependent with a demand for a further of gas supply. The South West Region of Western Australia produces 32% of the world's Alumina and is also an industry dependent on energy. Alcoa's alumina refinery at Wagerup is planned for expansion as is Worsley's Alumina plant (BHP Billiton and others) at Worsley/Boddington. The South West Region also hosts world class mineral sands deposits with value added industrial plants for titanium oxide and other products.
The Kemerton industrial area and the Port of Bunbury is key to other industrial mineral value added plants including Simcoa, the world's only fully integrated silicon metal production plant. All these industries are energy dependent. There is a strong and increasing demand for natural gas and power generation at Kemerton and the South West Region.
EP 432 Mullering - Oil Prospects
The Mullering Seismic line clearance commenced 18 March 2008 and is currently in progress. The acquisition of the 50km2 3D Seismic Survey is expected to commence 13 April 2008 after the Wellesley Seismic Survey.
The 3D seismic over the Mullering Anticline is designed to resolve and delineate several prospects to drilling status. Prospectivity for oil is demonstrated by the Cataby-1 well drilled on the Mullering Anticline, recovering oil on a drill stem test. The prospectivity within EP 432 is enhanced by a 200 metre thick sequence of shales and siltstones within the lower part of the Jurassic aged Cattamarra Coal Measures above the reservoir objectives. These shales are thick enough to also provide lateral seals on any crestal faults.
Interpretation of the existing seismic data has defined 10 leads in the Mullering/Cataby area. Potential recoverable oil reserves of these leads range from 5 to 10 million barrels each. The 3D seismic technique being recorded to define the leads to drilling status has proved highly successful in discovering both oil and gas in the North Perth Basin. Any oil discoveries in the EP 432 Permit could be "fast tracked" through development and trucking oil to the Kwinana Oil Refinery. Both Joint Venture partners, Allied Oil & Gas Plc and ERM Gas Pty Ltd, have an option to earn additional equity in EP 432 by contributing to drilling 1 well from the prospects delineated by the 3D seismic.
ERM Gas Pty Ltd's option is to increase its equity to 25% (a further 12.5%) by contributing 30% of the well costs. Allied Oil &Gas Plc can increase its equity to 50% by expending a further $1,500,000 towards the well costs.
EP 389 Gingin West Gas Prospect
The Gingin West 50km2 3D Seismic Survey is expected to commence 25 April 2008 following the completion of the Mullering 3D Survey in EP 432.
The Gingin West structure is located updip from the Bootine-1 well that flowed gas at a rate of 2.25 million cubic feet of gas per day from one sand in the Cattamarra Coal Measures. Additional sands to that tested in Bootine-1 are interpreted to be in closure. Potential recoverable gas reserves for Gingin West are estimated at 212 billion cubic feet of gas.
The Company also has the potential to sidetrack the Gingin 3 well drilled by the Company in 2000 into potential gas sands delineated by Empire's seismic recorded to date together with well data from gas discovery wells Gingin-1 and Gingin-2. Empire has observed gas amplitude anomalies on the seismic data set which is very encouraging. Potential recoverable gas reserves are in the order of 200 billion cubic feet of gas. The potential exists for gas to be entrapped southward of the Gingin-2 discovery well along the bounding fault. The recording of the 3D seismic will assist in assessing the large potential of the Gingin-2 South area.
Wharf Resources Plc has the option to contribute $4,000,000 towards the Gingin West-1 well to earn up to 60% in EP 389.
ERM Gas Pty Ltd also has the option to increase its equity up to 30% (from 12.5%) by contributing 32% to the costs of drilling the Gingin West-1 well.
The economics of developing and selling gas has increased during the last 12 months with substantially higher natural gas prices being paid by diversified consumers. There is an increasing demand for natural gas in Western Australia's deregulated market where producers of gas can negotiate gas sales prices directly with consumers. With the Dampier to Bunbury natural gas pipeline essentially full to capacity, the onshore Perth Basin, particularly the Gingin Gasfield area and the Gingin West Prospect located on the doorstep of the city of Perth, offers the gas market a diversity of supply from North West Shelf gas. The immediate (2 kilometres) proximity of the under-utilised Dongara to Pinjarra Natural Gas Pipeline (Parmelia Pipeline) offers immediate access to the market place for natural gas.
The proximity of Gingin West and the Gingin Prospects to power line infrastructure also provides the potential to sell the value added component of electricity by power generation on site into the State's electricity grid. Deregulation provides the opportunity to negotiate power sales directly with a power consumer.
Related Companies
Social Media
Share this Article
