Kina Petroleum spuds Elevala 2 well

By YEHIURA HRIEHWAZI
NEWLY-established Kina Petroleum’s Elevala 2 well was spudded on Tuesday to appraise the gas and condensate volume discovered by an explorer in 1991 but was abandoned due to low price of oil and gas prices at that time.
Horizon Petroleum, which is the operator of Elevala 2 well in petroleum retention licence (PRL) 21, said yesterday the well was being drilled using the drilling rig Parker Rig-226 to appraise the Elevala gas/condensate accumulation that was discovered by British Petroleum in Ele­vala-1 well and flowed at a rate of 11.9 million cubic feet of gas and 634 barrels of condensate per day during testing.
“Elevala-2 will be drilled to a total depth of 3,500m and penetrate the Elevala sandstone and the deeper Toro sandstone about 2.1km west of the Elevala-1 discovery.”
In the meantime, Kina Petroleum applied to the PNG Securities Commission on Nov 4 to be listed on the Port Moresby Stock Exchange.
Sources said yesterday its application was approved and Kina Petroleum  lodged its shares issues prospectus with brokers, Kina Securities Ltd and BSP Capital Ltd.
POMSoX spokesman Vincent Ivosa said yesterday Kina has yet to lodge its application to his office list as it was still getting organised.
Kina Petroleum planned to sell over 60 million shares to raise A$12.5 million to finance its share of the costs to appraise the extremely attractive wells.
“Horizon said an option to sidetrack to complete the well for production purposes would be available,” the company said.
Horizon held a 45% stake as operator of PRL 21 where it was partnered by Talisman Energy and Kina Petroleum , with each holding a 40% and 15% interest, respectively.
Kina Petroleum’s managing director Richard Schroder said yesterday BP targeted the Elevala feature looking for oil and at the time it was one of the largest undrilled structures in the foreland of PNG.
“The intersection of gas was deemed sub-commercial in the 1990s, but with energy prices now in excess of US$100 /barrel, the liquids component in the Elevala structure is considered highly attractive for development as a liquids stripping operation.
“Kina Petroleum expects the Elevala Sandstone to be drilled in middle of next month, some 35 days after spud,” he said.
Following Elevala 2, the rig will move to Ketu 2 to be drilled next February.
Ketu 2 was an appraisal of Ketu 1, also drilled by BP in 1991 and was also a gas discovery in the Elevala Sandstone.
Seismic operations were also underway in PRL 21 with 105km of seismic being acquired to help in the appraisal of the the Ketu and Elevala structures and better define the Tingyu Prospect immediately west of Eleval­a 1 discovery.
“Kina Petroleum is also exploring in the Gulf region of PNG.
“Oil Search has just recently finished acquiring seismic in Kina’s PPLs 338 and 339 … the seismic data has successfully identified an attractive reefal prospect, the Iviri South Prospect, north of Uramu gas field and south of the giant Elk Antelope discovery.
“This prospect is well placed for hydrocarbon charge and is currently being assessed by the joint venture as a potential drilling candidate,” Schroder said.
Kina Petroleum had completed its analysis of all seismic data in both the blocks and sees several other reefs like anomalies within PPL 338 as follow up to a successful Iviri South well.
The company had also identified a number of possible oil prone targets in PPL 338 and 339 that have formed as a result of recent thrust faulting of the Miocene carbonates and more recent clastic sediments.