Premier Oil Plugs Appraisal Well in Vietnam

PUBLISHED: 17 Aug 2012 @ 20:30 | Comments (0) | More info about Kenneth G. Mondero

The move by Premier Oil plc (LSE:PMO) to determine the northern extent of its’ Chim Sao oil field in Vietnam proved to be unsuccessful when the Chim Sao North West appraisal well did not find oil at one of the target reservoirs.

Drilling 4,235 metres, Premier plugged and abandoned the CS-3X well after only the Middle Dua sands indicated oil shows while the Upper Dua sands showed no indication of hydrocarbon.

The result may probably be unexpected as the appraisal well targeted the same reservoir penetrated by Premier’s development well exactly a year ago that encountered 20 metres of oil column in the Upper Dua sandstones and was successfully appraised to contain approximately 89 metres net pay.

Production testing is also ongoing at another appraisal at a rate of 4,000 barrels of oil per day (bopd), producing from four Upper Dua reservoirs at the north west extension of the Chim Sao field, which added to the disappointment.

“The information gained from the appraisal well will now be integrated with Premier’s existing knowledge to better understand the potential in the other untested areas adjacent to the Chim Sao discovery,” stated Simon Lockett, Chief Executive of Premier.

Premier holds 53.13% working interest in Block 12W where the Chim Sao oil field was located, offshore Vietnam and about 400 kilometres away from the country’s capital, Ho Chi Minh City.

Oil and gas was discovered in the said field back in 2008 and is now producing an average of 26,000 barrels of oil per day (bopd) and 25 million cubic feet (mmcfd) of gas.

Shares of the FTSE 250 constituent firm recovered by 11:12 AM GMT, after falling3.2% at the start of trading on the London Stock Exchange to 377.7 pence, following the news, and were 0.6% higher to 393 pence.

Company Spotlight

Premier Oil plc is an independent oil and gas exploration, production, and development company, with assets in eight countries, including: Vietnam, Pakistan, Pakistan, Egypt, Mauritania, Kenya, Norway, and the United Kingdom.

The firm has been trading publicly on the London Stock Exchange since 1973 and is a constituent of the FTSE 250, having a market value of £2 billion as of 16^th August 2012.

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