The Poseidon-1 well in the Browse Basin, which holds more than a third of Australia’s known offshore gas resources, will be plugged and abandoned after a fault made it impossible to conduct planned production tests, the Mt Martha, Victoria state- based explorer said in a statement today. A mechanical failure while attempting to retrieve equipment resulted in the well being “irreparably plugged.”
“It is never good to have that outcome but I think they have well and truly demonstrated that they have got something very substantial there,” said Peter Arden, a Melbourne-based analyst at Ord Minnett Ltd., an affiliate of JPMorgan Chase & Co. “They really just needed to get more testing out of it. I think the market has overreacted.”
Analysis of seismic and well results indicate the resource is likely to match or exceed pre-drill estimates of between 3 trillion and 15 trillion cubic feet of gas, the explorer said today. Planning has started for an appraisal of the Poseidon Field, Karoon Gas said.
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aYpVmuhnAj3I
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