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Cairn Energy Encounters Gas With First Well in Greenland

Wednesday, August 25, 2010

• Two offshore rigs currently operating in the previously undrilled Baffin Bay Basin
• First hydrocarbons discovered in Baffin Bay basin by T8-1 well which has encountered gas, in thin sands
• 2,500 km of 2D seismic to be acquired in the West Disko Eqqua Block
• 7,500 km of planned 2D seismic in southern Greenland underway
• Three site surveys in southern Greenland complete

Edinburgh-based Cairn, the first company for a decade to drill for oil offshore in Greenland, said it had "early indications of a working hydrocarbon system" in Baffin Bay.

Cairn commenced drilling operations on the Alpha (Alpha-1) and the T8 (T8-1) exploration prospects in the Sigguk Block, approximately 175 km offshore Disko Island, west Greenland in July using the Stena Don, a fifth generation semi submersible and the Stena Forth, a sixth generation drillship. The Alpha and T8 exploration prospects lie in water depths of between 300 and 500 metres and have planned target depths of 4,200 m and 3,250 m respectively. The operations on both wells are currently ongoing but are reaching a significant phase. The Alpha-1 well has been sidetracked in the volcanics lying above the main target section for mechanical reasons and is currently anticipated to reach target depth in September. The T8-1 well has encountered biogenic gas with components of thermogenic gas in thin sands and is expected to reach target depth by the end of August.

The third exploration well in the current sequence will be located on the T4 Prospect approx. 150 km north west of Alpha and 150 km north of T8. The fourth well in this season's programme is dependent on the drilling schedule and is yet to be decided.

This article is for information and discussion purposes only and does not form a recommendation to invest or otherwise. The value of an investment may fall. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser. More

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