Citrus #7 well at Southeast Lost Hills encounters Gas Shows in...

Citrus #7 well at Southeast Lost Hills encounters Gas Shows in Diatomite Section
worthy of further testing
Orchard Petroleum Limited (ASX: OPL) (Orchard) and Orchard Petroleum Inc. (OP Inc.), a wholly owned subsidiary of Orchard, announces that the Citrus #7 well has been completed to a depth of 5,000 feet with wire line logs indicating good gas shows in a deeper Diatomite section and some indications of oil as well. The Citrus well was drilled deeper than originally intended due to the increasing occurrence of hydrocarbon shows with depth.

Gas shows were observed in the shallower targeted Pliocene sands, but subsequent review of the wire line logs indicated that they were wet. However, the well encountered an unexpectedly thick diatomaceous sequence underlying the Pliocene with pervasive mudlog shows which may be hydrocarbon bearing. Citrus #7 drilled through 510 feet of this diatomaceous rock before stopping at 5,000 feet, which was the maximum depth the rig could penetrate. The quality of the shows improved as the well approached total depth. It is highly likely that the diatomaceous section will be significantly thicker, and there is a reasonable expectation, based on experience at Orchard’s South Belridge Project, that the quality of the rock will improve. The equivalent Belridge Diatomite is a prolific producer at the South Belridge Field six miles to the south.

The current plan is to contract a new rig capable of drilling the Citrus #7 well deeper using the same borehole through to the diatomaceous section and continue on to the Monterey Formation.

The Monterey Formation is a prolific oil and gas producing interval in the Lost Hills Field, immediately to the north of the Citrus #7 well. This strategy will allow us to determine the total thickness of the diatomaceous section, which would therefore enable us to optimize testing procedures, as well as to assess the potential of this southerly extension of the Monterey trend.