Promising flow rates prompt strategy review

promisingNEW Zealand-focussed Kea Petroleum is undertaking a review of strategic options for its onshore Taranaki Block following further positive results from testing and flow rates at its Puka field.
Kea reported that the combined flow rate from the Puka-1 and Puka-2 wells had stabilised at about 200 barrels of oil per day. The company planned to undertake further analysis of well data and seismic interpretation, in addition to ongoing work on a field development
plan.
The wells had produced a total of 5049 barrels of oil and 101.52m cubic feet of gas since the most recent phase of testing began in July.
“The directors believe that the scale of the Puka discovery, and the current challenges for small sized oil explorers in accessing capital markets, merit a review to assess strategic alternatives that will enable shareholders to maximise full value from the Puka fields,” the company stated.
Kea had also received interest from a number of larger companies interested in potential participation in the development of Puka, which was situated within the 210.8 square kilometre Petroleum Exploration Permit 51153.
Puka-1 reached its target depth of 1550m in April 2012 and encountered a 40m interval of Mt Messenger reservoir quality sands with a net pay of between 4.5m and 9m, with sampling indicating excellent quality light oil with a density of 43.7 degrees API and a relatively low pour point of 15 degrees centigrade.
Further tests confirmed that Puka was an oil and gas field of commercial dimensions with maximum flow rates of 310 bopd and 1.8 million cubic feet per day of gas from Puka-1, with no confining boundaries. Kea planned to drill a third appraisal well, Puka-3, in the first quarter of the 2014 calendar year.
Meanwhile, the company relinquished its Angus prospect (PEP51155; onshore Taranaki Block), following processing and interpretation of recently acquired 2D seismic data. It also pointed to a “diminished appetite for deep gas plays” as another reason for the decision.