Desire comes up dry on its latest drilling operation

MIDLANDS based oil and gas exploration firm Desire Petroleum has come up dry on its latest test well.

The announcement had a dramatic effect on early trading, with shares in the firm dropping 24%.

The Malvern business is one of a number of exploration firms currently drilling in the North Falkland Basin.

In a statement today, the company said it latest drilling operation – the 14/15-1 well on the Rachel prospect – had reached a depth of around 9,500 ft (2,877m) but had failed to find the presence of any hydrocarbons.

However, it said data recovered from the operation, including large deposits of porous sandstone had proved useful.

“The Rachel well has provided much new valuable data on the distribution of the reservoir targets within the Eastern Flank play and in particular the calibration of the 3D seismic data for sandstone prediction.  

“Our understanding of this play type is rapidly evolving but one of the biggest remaining uncertainties relates to the oil charging mechanism from the mature oil source rock to the fan sandstones.  

“Based on the latest information from this well, potential sandstones have now been identified downdip from the existing location, closer to the mature oil source rock, significantly reducing the oil charge risk,” said the statement.

Desire will now sidetrack the well and re-evaluate it prospectivity.

It said this would begin once the present drilling operation was complete.

The sidetrack will be designated 14/15-1Z and is expected to take 20 days. The company will make a further announcement once this is complete.
 
The Rachel well is the first of four wells likely to be drilled by Desire. The company said the intention once the 14/15-1Z sidetracking had taken place, was to move its rig to the next location – 25/5-1 on the Dawn/Jacinta prospect. Desire has the drilling rights for this under the terms of its Tranche I licence.

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