OilVoice - Ithaca Energy Set to Drill UK Stella Appraisal Well

Ithaca Energy Set to Drill UK Stella Appraisal Well

Thursday, February 11, 2010

Ithaca Energy Inc., an AIM listed independent oil & gas company with exploration, development and production assets in the UK sector of the North Sea, announces that the Galaxy II heavy duty jack-up rig, contracted by Ithaca to drill an appraisal well on the Stella field, has now come on hire and been mobilised to the spud location and will commence drilling this month.

The primary objectives are as follows:
i) Confirm Ithaca's assessment of the in-place volume of hydrocarbons
ii) Understand changes in composition of hydrocarbon fluids with depth
iii) Verify the distribution and quality of the reservoir

The drilling schedule includes drill stem testing and a contingent sidetrack to ensure that the well objectives are fully satisfied and field upside is appraised prior to development.

The appraisal well is planned to reach total depth in the Cretaceous chalk layers which lie below the principal Stella (Andrew) reservoir target. An earlier well (30/6-3Z) encountered hydrocarbons in the Ekofisk chalk reservoir and tested further rich gas-condensate reserves which could be developed at the same time as the main pool.

Timely development of Stella will allow the Company to consider the potential development of the neighbouring Harrier and Hurricane discoveries as additional tiebacks to Stella in this prolific gas-condensate area.

The latest reserves report issued by Sproule International Limited for year ended December 31 2009, ascribed Proved and Probable reserves to Stella (both Andrew and Ekofisk reservoirs) of 8.94 million barrels of oil equivalent net to Ithaca after consideration of the CMI farmout.

Current Joint Venture Partners in block 30/6 (Stella and Harrier) are Ithaca (68.33%), Dyas UK Ltd (31.67%) but post completion of the farm out to CMI will be Ithaca (50.33%), Dyas UK Ltd (31.67%), CMI (18.00%).