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New Zealand – focussed oil and gas explorer Kea Petroleum plc (LSE:KEA) said its first exploration well in the country this year is a commercial discovery, more than a month after oil and gas was discovered.
In a statement today, Kea confirmed there was “no confining boundaries” observed during initial build up and the maximum flow rate achieved was at 310 barrels of oil and 1.8 million cubic feet of gas per day.
Testing is still continuous at the said well using different choke sizes to determine optimum production parameters for future field performance, the company said.
The announcement follows the statement of Ian Gowrie-Smith, the company’s Chairman, that Kea was in the brink of becoming a commercial oil and gas producer.
“We are delighted that the latest oil and gas flow and down hole pressures data have led to the conclusion that the Puka discovery is indeed a commercial oil field discovery,” Mr. Gowrie-Smith now stated.
As revealed last 15th August 2012, a second well, Puka-2, is now in its advanced stage of planning. Puka-2 well will be the production well as the Puka-1 is not ideal for production, being a slim hole exploration well that limits production rates, the company said.
A 3D seismic survey is also put in place in time for the summer to assist management to locate further drilling targets, Kea added.
In preparations for production, Kea has moved its facilities to the Puka site as the company pushes to start generating revenue from the newly discovered oilfield.
In London, Kea Petroleum shares moved 2.9% to 9 pence following the announcement by 9 AM GMT.
Company Spotlight
Kea Petroleum plc shares are listed on the Alternative Investment Market of the London Stock Exchange. The company focusses its oil and gas exploration in New Zealand in the Taranaki Basin, where the largest onshore oilfields in the Australasia region is located.
