Target Energy increases stake in Louisiana prospect, targets both gas and oil in initial well Monday, April 02, 2012 by Bevis Yeo Target Energy (ASX: TEX) has increased its working interest in the Shepard’s Channel prospect in Lafourche Parish, Louisiana, which could hold up to 200 billion cubic feet of gas and 12 million barrels of oil to 15.33% from 10.33%.
The company is buying the interest for a cash payment of US$35,000 (A$33,660) along with a further US$90,000 to be paid out of future net cash flow from the initial re-entry well.
Detailed analysis of the previously abandoned well had indicated the hydrocarbon potential of the target channel sand were suppressed on the wireline logs and that if tested, they could have flowed at potentially commercial rates.
Since then gas shows have been encountered in the sand while a 8 metre thick potentially productive sand has been identified below the main channel sand. This additional sand will also be tested.
Should this re-entry well be successful, the joint venture holds 2 more wells that be re-entered quickly to further boost production.
Shepard’s Channel covers about 1800 acres (7.3 kilometres). Register here to be notified of future Target Energy articles.
NGE Price at posting:
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