Australian oil and gas company Calima Energy (ASX:CE1) has confirmed that core and wireline log data from its maiden well indicate the explorer has hit the prolific Montney Formation geology at its tenements in British Columbia, Canada.
The Montney is Canada’s most active oil and gas province, rich in both gas and condensate, with Calima holding a sizeable 72,000 acres of drilling rights throughout the region.
The company spudded its first well in the earlier this month, which was drilled to a depth of 1,872.5m.
Testing has unveiled it has hit a 256.5m thick section of the energy-rich Montney geological formation.
The company believes wireline logs are correlateable to nearby wells, with preliminary analyses showing hydrocarbon saturations and porosity measurements comparable with adjacent producing wells.
Core analysis has also been favourable, confirming the presence of upper, middle and lower zones, matching geological structures targeted by other Montney operators.
“We are delighted with the operational progress and initial results from the Calima-1 well,” Calima Energy managing director Alan Stein said.
“Our prediction that the Montney Formation on the Calima Lands would be comparable to the productive land immediately to the south appears to have been validated.
“We have encountered zones with enhanced reservoir characteristics containing gas and natural gas condensates with a calculated API gravity of 55o.
This is particularly significant for our economics because condensates from the Montney are generally priced at a premium to West Texas Intermediate (WTI) crude oil,” he said.
The core and wireline log data will influence the depth for Calima’s two other planned horizontal wells.
Both of these wells are planned to include 2,500m of horizontal drilling.
The second of the Company’s three-well program has already been spudded with further news of its oil and gas potential anticipated shortly.
