OILEX is preparing for an intensive period of work as it moves towards further exploration drilling in the Timor Sea and North West Shelf, and improving production at the Cambay field in Gujarat, India. Speaking to PetroleumNews.net, managing director Bruce McCarthy said the JPDA 06-103 joint venture was disappointed with the results of the recent Timor Sea drilling campaign but remained optimistic. Oilex, as operator of JPDA 06-103, drilled two wells, Lore-1 and Lolotoe-1, late last year. Both wells were plugged and abandoned after logs confirmed no zones of significant hydrocarbons. McCarthy said the company was in the process of analysing the results from the two wells before selecting locations for further wells to be drilled later this year. The two prospects that we drilled were the easternmost [prospects] and maybe we need to move a little further west to be in the main oil charge area, he said. Were going though analysis of the similarities and differences between the prospects that we drilled and those in the northern part of the block which are very large. Those prospects up there [in the northern section] have different characteristics that may be more favourable to accumulation of oil. The block is a large block and does have a lot of prospects, and the geological provinces change as you go particularly further to the north. We remain particularly optimistic about the potential on that block. Oilex holds a 10% stake in JPDA 06-103 which is near several production fields as well as Enis recent Kitan oil discovery which is under development. Over in the North West Shelf, McCarthy said the company was still carrying out detailed work on data from a 3D seismic survey recorded over WA-388-P last August but hoped to complete the interpretation by the end of February or early March. Sometime in March well have a much better view on the risk involved and well be consequently recommending to the joint venture whether we go to drilling quickly, he said. At the moment, we remain optimistic. Oilex is preparing a portfolio of prospects and leads with a potential drilling decision to be made this year. WA-388-P lies to the north of the North Rankin, Goodwin and Perseus gas and condensate fields currently being produced by the Northwest Shelf Venture. The field is also near the large Jansz/IO discovery. On the companys Cambay field in Gujarat India, McCarthy said the company has started a farm-out process and would consider farm-out options for its Indian assets as part of a risk management strategy. He said Oilex was keen to develop business in India and was taking steps to improve its position in the country. During the December quarter, the Cambay, Bhandut and Sabarmati fields produced 5143 barrels of oil (Oilex share) despite oil production from the Miocene Basal Sand in the Cambay field continuing to decline from the Cambay-74 and 64 wells.
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If the news flow is what is stated I would expect that this is the bottom At the end of the quarter, Oilex had $19.2 million in cash with no corporate debt.
OEX Price at posting:
9.6¢ Sentiment: LT Buy Disclosure: Held
