Carpathian Resources Limited (Carpathian), the oil and gas producer and explorer focusing in Central Europe, announces that the Mo-1 Skotnice (Skotnice) was spudded on November 28th 2006 in the Mošnov exploration permit.
Drilling of the Skotnice well will be funded from current earnings. Carpathian''s operating revenue in 2006 from gas net of direct production costs is forecast to be AUD 1.9 million or £760,000.
The well location lies between the depleted Kremlin gas field to the north and the Priobor-Klokocov Field to the south which it is reported produced 23 billion cubic feet of gas between 1945 and 1984 at rates of up to 5 million cubic feet per day. The Skotnice prospect has been defined by a detailed study of some 28 coal exploration holes, 0.5 – 1 kilometre apart and the targets are Tertiary sandstones in a potential trap at a depth of about 400 metres and sandstones within the Carboniferous section not far beneath.
The location is very close to and updip of a coal exploration hole from which a gas flow of 80,000 cubic metres (approximately 2.8 million cubic feet per day) was recorded in 1961, some two years after it had been drilled. While this open flow rate might not be sustainable, an economic analysis indicates that given the strong gas price and the proximity of the gas transmission network, sustainable flow rates of as little as 10% of this figure could be economically attractive.
Philip Linsley, a Director of Carpathian Resources, commented we are delighted that after some delay drilling has begun in such a prospective area.
