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13/7/2018 — Oil and Gas
Melbana reviewing Puka project

The minor partner for the planned resumption of production on PEP 51153 in the onshore Taranaki, Melbana Energy Ltd (ASX: MAY), said testing of the new discovery zone at various flow rates continued using a variety of choke sizes.

In its June quarter report, Melbana said the Pukatea-1 well completed by operating partner TAG Oil (TSX: TAO; OTC: TAOIFF) had encountered in the Mt Messenger Formation 12.9 metres of oil and gas-bearing sands that were perforated.

Over a 12-hour test period using a 24/64" choke setting, the well flowed at a stabilised rate of about 276 boe/day (74% oil) without the need for artificial lift.

“The Joint Venture will review various production scenarios over the medium term to bring the Puka field online. Melbana is currently undertaking a strategic review of its New Zealand activities,” the company said.

That strategic review undoubtedly includes the growing perception that there are negatives now on the future of petroleum production in the country following the ban invoked by the Ardern Government on new offshore permits.

In recent months’ Melbana has placed its strongest activity on its Cuba permits and potentially gas-rich offshore targets in Western Australia’s North West.

Melbana’s report said TAG operates the nearby Cheal production complex, less than 10 kilometres from Pukatea.

An independent expert values TAG’s 2P reserves in nearby fields at $A20/barrel (on an NPV10 basis). PEP 51153 contains the suspended Puka oil field.

Three wells have been drilled since the Puka oil field was discovered in 2012, with the Puka-1 and Puka-2 wells producing 100 barrels/day from the Mt Messenger Formation before being shut in due to low oil prices and mechanical issues.

PDF File Financial statement. (280.9 kilobytes)
PDF File Quarterly report. (1.1 megabytes)
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