the announcement
Activities on Seram Island
Document date: Tue 07 Jan 2003 Published: Tue 07 Jan 2003 15:35:01
Document No: 230426 Document part: A
Market Flag: Y
Classification: Progress Report
KALREZ ENERGY LIMITED 2003-01-07 ASX-SIGNAL-G
HOMEX - Perth
+++++++++++++++++++++++++
Following is an update on current activities of our interests on
Seram Island.
BULA DEVELOPMENT WELL ACHIEVES STRONG OIL SHOWS (KALREZ - 100%)
Development Well 89-K-5 spudded on December 31 2002 in the Bula
Tengarra Region of the Company's wholly owned Bula field on Seram
Island in Eastern Indonesia.
The well has reached a depth of 344.74 mKB, with drilling currently
suspended. Current operations are conditioning mud for electric
logging of the open hole section from 61.5mKB to 344.74mKb.
After registering oil shows in the interval 132.5 - 140mKB, further
shows were recorded in the interval 222.5 - 244.75mKB, with good oil
shows from 232.5 - 237.5 mKB and excellent shows from 242.5 -
244.75mKB. At this depth influx of oil and gas was significant and
drilling suspended whilst mud weight was increased to 11PPG.
Following electric logging 7" casing will be run to approximately
220mKB (to be confirmed from electric log data).
After setting 7" casing, the zone 220-244.75 mKB will be under reamed
and subject to results the well may be deepened until a change of
lithology from the current sandstone.
The initial results are pleasing and confirm the potential for
further development in the Bula Tengarra region. A further well will
be drilled in this region immediately following the completion of
89-K-5.
Whilst it is expected that the well will be completed successfully as
a producer, it should be understood that there have been previous
difficulties associated with completions of similar wells in this
region. We refer to commentary in our earlier ASX announcement of the
3rd January 2003.
A final report will be issued after the well is completed.
COMMISSIONING CONTINUES AT OSEIL (KALREZ - 2.5%)
Kalrez Energy Limited is a 2.5% shareholder in the Seram Joint
Venture which owns and operates the Oseil oilfield. The major
shareholder, and operator of the JV, is Kufpec (Indonesia) Limited
with 97.5%.
Kufpec have advised that the Oseil oilfield is continuing to
experience normal commissioning issues associated with oil of this
type (low API, high sulphur). To date approximately 30,000 barrels of
oil have been produced. Oseil 4 continues to flow under natural flow
at approximately 4,000 barrels per day. Kufpec are concentrating on
bringing Oseil 2 onstream, after which they will commence
commissioning of Oseil 1.
For further enquiries please feel free to contact Mr Eddie Smith or
Mr Simon Lill at the Company's offices on (618) 9362 9330.
E Smith
CHAIRMAN
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