Indago Petroleum Limited, the oil and gas exploration company exploring onshore the Sultanate of Oman, announces a drilling update for the Al Jariya-1 well, located on the Jebel Hafit prospect in Block 31, adjacent to the border with Abu Dhabi.
The Al Jariya-1 well, which is expected to drill to a total depth (TD) of 5,900 metres, has reached a depth of 2,605 metres as at today's date.
The well has proved to be technically very difficult. It was always designed as a high pressure, high temperature test, but in addition tectonic movements have produced 'stressed' rock formations which resulted in mechanical difficulties whilst drilling, provoking two sidetracks at approximately 2,000 metres. As reported in the Company's Preliminary Statement on 25 May this year, casing was therefore set at that depth - earlier than originally planned. As a further precaution, an 11 3/4' liner has also just been set in the section to 2,600 metres.
Although it had not been anticipated that such difficult drilling conditions would be encountered at these relatively shallow depths, the geological aspects of the well remain consistent with the pre-drill prognosis.
The rig operator is currently completing an overhaul and review of the rig in order to ensure that it is fully prepared for the significant challenges of the next section. Drilling is expected to recommence shortly, after which a forecast 91 days of drilling will be required to reach TD.
The developments as outlined above have increased Indago's investment in the well by an estimated $8.2 million, however this additional funding requirement has in no way compromised the Company's ability to complete its current committed exploration programme.
Once operations at the Al Jariya-1 well have been concluded, the rig will move to the next well in the programme: the Zad well on the Adam prospect in Block 47, provisionally scheduled to start in the fourth quarter of 2007.
Martin Groak, CEO, commenting on today's announcement said:
'Al Jariya has proven to be a very challenging well and the Operator is proceeding as efficiently and as cautiously as the conditions permit. Although the relatively slow progress has brought with it substantially increased costs, the prospectivity of Jebel Hafit is undiminished and Indago is funded to complete both this well and the rest of the planned work programme.'
Indago holds an approximate 50% interest in Block 31. The Operator, RAK Petroleum PCL, holds the balance of the interest.