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Press release from Marketwire

Ithaca Energy Inc.: Hurricane Appraisal Well-Successful Test Results

Tuesday, September 04, 2012

Ithaca Energy Inc.: Hurricane Appraisal Well-Successful Test Results02:00 EDT Tuesday, September 04, 2012LONDON, UNITED KINGDOM and CALGARY, ALBERTA--(Marketwire - Sept. 4, 2012) -NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATESIthaca Energy Inc. (TSX:IAE)(AIM:IAE) announces that it has completed a successful drill stem test ("DST") on the Andrew sandstone interval in the Hurricane appraisal well, 29/10b-8, The DST achieved a gross maximum flow rate of approximately 24 million standard cubic feet of gas per day ("MMscf/d") with associated condensate of 1,200 barrels per day ("bbl/d") from a 44/64-inch fixed choke. The wellbore will now be suspended as a future Andrew reservoir production well with the capability of also producing from the Rogaland reservoir.Well 29/10b-8 was drilled to appraise sands in the eastern lobe of the Hurricane structural closure, located in the Company's Greater Stella Area ("GSA") of the UK Central North Sea.The well intersected 32 feet of Eocene Rogaland sandstone with an average porosity of 28% over the net sands. A full core of the Rogaland reservoir section was extracted. Fluid samples and downhole pressure data have confirmed the presence of liquid rich gas throughout the interval; the samples indicate a condensate-gas ratio ("CGR") of between 60 and 110 barrels of condensate per MMscf. Sufficient data was obtained to remove the need to perform a well test on this interval. Analysis of pressure data indicates the hydrocarbon-water contact is likely to be the same as that in the Hurricane discovery well, 29/10-4Z (located in the western lobe of the structure), at 9,438 feet True Vertical Depth Subsea.The well also intersected 20 feet of Palaeocene Andrew sandstone reservoir, similar in nature and thickness to that observed in the main Andrew sandstone reservoir of the Stella field, approximately 10 kilometres east of Hurricane. The reservoir is of good quality, similar to that of Stella with average porosity of 26% over the net sands, and is considered to potentially be part of a more extensive Andrew sand unit in the area.During the main flow period lasting approximately 24 hours, the Andrew interval achieved an average gross flow rate of approximately 17 MMscf/d with associated condensate of 870 bbl/d (52° American Petroleum Institute ("API") Gravity) from a half inch choke. A gross maximum flow rate of 24 MMscf/d with associated condensate of 1,200 bbl/d was also achieved, with the full production potential of the well being limited by surface equipment.The well will now be suspended for future potential use as a production well for the Andrew reservoir, with the capability of also being used for future production from the Rogaland reservoir.Nick Muir, Chief Technical Officer, commented:"The successful results of the Hurricane appraisal well have clearly demonstrated the significant potential of the Andrew reservoir play fairway in the Company's Greater Stella Area. A work programme has already been launched to assess the development options and ultimately recoverable volumes for Hurricane, both in terms of the Rogaland and Andrew reservoirs, and the optimal solution for its integration into the ongoing development of the nearby Stella and Harrier fields; this will include the likely use of the current well as a producer. All the major contracts for the Stella development have now been awarded and the next key milestone will be the selection of the yard in which the modification works will be performed on the FPF-1 floating production unit."The well was drilled using the WilHunter enhanced pacesetter semi-submersible rig, owned by Awilco Drilling plc and managed by the services of Applied Drilling Technology International ("ADTI").The Joint Venture partners in the Ithaca operated Block 29/10b (Hurricane) are Ithaca Energy (UK) Ltd (54.66%), Dyas UK Ltd (25.34%) and Petrofac Energy Developments UK Limited (20%)Notes to oil and gas disclosure:In accordance with AIM Guidelines, Hugh Morel, BSc Physics and Geology (Durham), PhD Hydrogeology (London) and senior petroleum engineer at Ithaca is the qualified person that has reviewed the technical information contained in this press release. Dr Morel has 30 years operating experience in the upstream oil industry.The well test results disclosed in this news release represent short-term results, which may not necessarily be indicative of long-term well performance or ultimate hydrocarbon recovery therefrom.About Ithaca Energy:Ithaca Energy Inc. and its wholly owned subsidiary Ithaca Energy (UK) Limited ("Ithaca" or "the Company"), is an oil and gas exploration, development and production company active in the United Kingdom's Continental Shelf ("UKCS"). The goal of Ithaca, in the near term, is to maximize production and achieve early production from the development of existing discoveries on properties held by Ithaca, to originate and participate in exploration and appraisal on properties held by Ithaca when capital permits, and to consider other opportunities for growth as they are identified from time to time by IthacaNot for Distribution to U.S. Newswire Services or for Dissemination in the United StatesForward-looking statementsSome of the statements in this announcement are forward-looking. Forward-looking statements include statements regarding the intent, belief and current expectations of Ithaca Energy Inc. or its officers with respect to various matters. When used in this announcement in connection with the Hurricane appraisal well, the production potential of the well and the development potential of the identified hydrocarbons or otherwise, the words "anticipate", "continue", "estimate", "expect", "may", "will", "project", "plan", "should", "believe", "could", "target" and similar expressions, and the negatives thereof, are intended to identify forward-looking statements. Such statements are not promises or guarantees, and are subject to known and unknown risks and uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements or information. In the view of the Company's management, this information reflects the best currently available estimates and judgements, and presents, to the best of management's knowledge and belief, the expected course of action. These forward-looking statements speak only as of the date of this announcement. Ithaca Energy Inc. expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statement contained herein to reflect any change in its expectations with regard thereto or any change in events, conditions or circumstances on which any forward-looking statement is based except as required by applicable securities laws. Readers are cautioned that the forward-looking statements contained in this press release should not be used for purposes other than for which it is disclosed herein. These statements may not be appropriate for other purposes.FOR FURTHER INFORMATION PLEASE CONTACT: Iain McKendrickIthaca EnergyCEO+44 (0) 1224 650 261imckendrick@ithacaenergy.comORNick MuirIthaca EnergyCTO+44 (0) 1224 650 267nmuir@ithacaenergy.comORPhilip DennisPelham Bell Pottinger Public Relations+44 (0) 207 861 3919pdennis@pelhambellpottinger.co.ukORRollo Crichton-StuartPelham Bell Pottinger Public Relations+44 (0) 207 861 3918rcrichton-stuart@pelhambellpottinger.co.ukORJon FitzpatrickCenkos Securities plc+44 (0) 207 397 8900jfitzpatrick@cenkos.comORBeth McKiernanCenkos Securities plc+44 (0) 131 220 6939bmckiernan@cenkos.comORTim ChapmanRBC Capital Markets+44 (0) 207 653 4641tim.chapman@rbccm.comORMatthew CoakesRBC Capital Markets+44 (0) 207 653 4871matthew.coakes@rbccm.com