Encouraging results for InterOil

 INTEROIL’s promising appraisal results of the Elk-Antelope gas field in Gulf underpin a multi-train LNG project.

In announcing financial results for the first quarter, chief executive officer Dr Michael Hession said well results from Antelope-5 had been very encouraging.

“Drilling results from Antelope-5 identify this well as having the best reservoir thickness, quality and fracture density of all wells drilled on the Elk-Antelope field,” Hession said.

“In particular, the thickness and quality of the dolomite zone with porosity readings of up to 25 per cent is superior to other wells, signifying a high-quality reservoir.

“Under the initial clean-up flow, the flow rate at Antelope-5 has been constrained to a maximum rate of about 74 million standard cubic feet a day.

“Testing will be extended to include pressure measurements on other wells in the field to determine reservoir connectivity. Initial results at Antelope-4 have provided strong indications of a high-quality reservoir with a gross gas column of at least 300m.”

But, Hession said Antelope-4 has been suspended due to mechanical problems about 150m above the field gas-water contact.

InterOil and its joint venture partners Total and Oil Search are now evaluating data from the well before deciding on next steps towards establishing the country’s second LNG project. Operator French’s Total will draw gas from the Elk/ Antelope gas fields for the project.

Hession said it was anticipated that a preferred development concept for the LNG plant would be announced by the middle of this year.

“The PRL15 joint venture will drill Antelope-6 to provide enhanced structural control and further definition of reservoir extent and quality,” he said. 

“These appraisal results underpin a multi-train development at Elk-Antelope and the quantification of volumes in this world-class resource.

“In addition to the Elk-Antelope gas fields, InterOil will continue to appraise the resource at the Triceratops field and will resume exploration drilling at Wahoo-1 around mid-year.

“With US$628 million (K1.7bn) of liquidity, InterOil is well positioned to move into this next exciting phase of growth.”

In the first three months, InterOil recorded a loss of US$21.9m (K59.2m) compared to a net profit of US$318.6m (K862.2m) same period last year.

Most of this loss resulted from expensing US$19.3m (K52m) of seismic that the company acquired over its extensive exploration portfolio during the quarter.

InterOil had US$328m (K883m) in cash and receivables plus $300m (K807m) in undrawn credit as at March 31.