CVN 2.00% 24.5¢ carnarvon petroleum limited

Update on Testing of New Wichian Buri Oil Wells

  1. 653 Posts.
    Sounds pretty positive to me.


    HOMEX - Perth

    Carnarvon Petroleum NL is pleased to announce that the testing of the
    new Phase II discovery wells which commenced on Sunday, 3 November
    2002, is proceeding positively. Preliminary testing has been
    completed on each of the three new wells, WB-N4, WB-N5 and WB-N6.
    Petrophysical interpretation suggests that the northerly WB-N4 and
    WB-N6 wells have intersected a well developed F Sandstone reservoir
    when compared to previous wells drilled on the Wichian Buri North
    structure. The quality of the F Sandstone at WB-N4 and WB-N6 has also
    been reflected in the well testing to date.

    Oil recovered during the testing is being sold to the refinery and at
    the conclusion of the tests the wells will be put on long-term
    commercial production. This is expected within the next two weeks.

    WB-N4 was the first well to be tested. It flowed oil to the surface
    facilities under natural flow conditions without the need for
    artificial lift. Apart from operational interruptions, as for example
    to run pressure gauges, during daylight hours the well has since been
    flowed continuously to the production tanks at increasing rates to
    allow it to clean up. Pressure gauges have been run in WB-N4 to allow
    a natural flow and buildup test. Upon completion of that test jet pump
    testing will be initiated at WB-N4.

    WB-N6 was the second well to be tested and, like WB-N4, the well has
    flowed oil consistently under natural flow conditions during daylight
    hours while being shut-in overnight. Jet pump testing has just been
    initiated at WB-N6.

    Testing of WB-N5 commenced on Thursday, 7 November. This well did not
    flow oil to surface under natural flow conditions but is expected to
    flow oil when tested with a jet pump, following that of WB-N6 and
    WB-N4 respectively.

    Flow rate information will be provided once representative values
    have been derived from testing both naturally and under pumped
    conditions. The jet pump is a tried and proven oil field technology
    but this is the first time that these types of pumps have been used
    at Wichian Buri and it may take some time to optimise performance.
    Actual sustainable oil production rates will ultimately be dictated
    by the reservoir, which provides the driving force for oil recovery.
    The reservoir capabilities are as yet unknown and it will take some
    period of production before long term sustainable rates for each zone
    and each well can be reliably estimated.

    Flowing the wells naturally while the reservoir is still largely
    undisturbed allows the best opportunity to collect essential
    reservoir, well and fluid data and calculate key properties and
    parameters. Jet pump testing will enable the Joint Venture partners
    to determine the optimal settings for the pumps in order to maximise
    production capabilities for the new wells.

    The Managing Director of Carnarvon Petroleum, Dr Ken Tregonning, has
    been actively involved onsite with the testing and evaluation
    program. On his recent return to Australia from Thailand he said: "We
    are working closely with the Operator, Pacific Tiger Energy of
    Canada, to develop and implement the optimal evaluation and
    production program for these Phase II development wells. We are
    satisfied that the Operator is doing this effectively. This first
    part of the testing program is designed to maximise our understanding
    of the F Sandstone reservoir in these exciting new discoveries and to
    maximise the oil production that the Joint Venture partners will
    derive from these new wells."

    After production testing the F Sandstone reservoir in each of the
    three new wells, the Joint Venture Partners will plan for the
    perforation of the other newly discovered oil reservoirs in the E and
    G Sandstones. The new horizons will then be put on long-term
    commercial production along with the F Sandstone horizon.

    Dr Tregonning added: "It is crucial to proceed with the testing
    program in a systematic and organised fashion without merely rushing
    to produce at the highest initial rate possible. These new wells have
    proved the northerly extension to the Wichian Buri Field F Sandstones
    so its current status is of a developing field under appraisal for
    which the value of information is at a premium.

    "As yet no closure is seen to the northern structure. This is perhaps
    of equal significance to the improved sand quality. Preliminary
    results from these new wells indicate that there is now room to drill
    producing wells over a wide area."

    New wells are under consideration for the next stage of development,
    Phase III, in areas of Production Licence 2 which was recently
    awarded to the Joint Venture as well as elsewhere in the 4000 square
    km expanse of Exploration Block L44/43.

    Carnarvon Petroleum NL is a listed junior oil and gas exploration and
    production company. Carnarvon has oil and gas reserves and production
    in the Wichian Buri Oilfield in Thailand, and reserves in Papua New
    Guinea and the North West Shelf of Australia. The SW1A Joint Venture
    consists of Carnarvon Petroleum NL (40% interest) and Pacific Tiger
    Energy Inc (60% - Operator).

    For further details please contact:

    Dr Ken Tregonning in Melbourne on 03 9824 2104
    or Mr Leonard Troncone, in Perth on 08 9288 4522

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