Transeuro Energy Corp. provides an update of operations at the Karlavskoye 101 well, Ukraine.
While completing a downhole surge test of the upper sections of the reservoir, Transeuro has produced the first gas to surface from the Karlavskoye 101 well. The test is a requirement of the Ukraine government regulations and the result physically confirms the presence of gas in the well. Reservoir fluids were allowed to flow into the drillpipe for a short period so that a sample could be captured in a downhole chamber. The plans did not require the well to flow continuously to surface. Once the downhole sample was captured, the well was shut in and the remaining gas was removed from the drill-string and flared.
Operations are now continuing to drill the remaining 240 m to the bottom of the target zones at 3,550 meters at the base of the C16 reservoir interval. The Company intends to log and run casing before commencing full testing operations. As reported earlier, repeated gas kicks and oil shows were seen in the upper reservoirs and it is anticipated the well will be completed in the second quarter.
The 'discovered resources' attributed to the Karlavskoye field by Fekete Associates Inc. under the Canadian 51-101 reserves reporting standards has increased to a mean estimate of 474 billion cubic feet of gas (85.32 million barrel of oil equivalent). Under the terms of the Joint Activity Agreement with the local government partner 'Crymgeologiya', Transeuro has 72% of the profits derived from the development of the Karlavskoye field. Upon closing of the JVA with RAG of Austria and Transeuro will hold 36% and RAG 36% of the profits.
Discovered resources are defined in the Canadian Oil and Gas Evaluation Handbook, "Discovered resources are those quantities of oil and gas estimated on a given date to be remaining in, plus those quantities already produced from, known accumulations. Discovered resources are divided into economic and uneconomic categories, with the estimated future recoverable portion classified as reserves and contingent resources, respectively. There is no certainty that it will be commercially viable to produce any portion of the resources."