LONDON (Alliance News) - Range Resources Ltd Tuesday said it will start drilling the Canari North exploration well on the Guayaguayare Block onshore Trinidad before the end of July.
The well will be the first exploration well to be drilled by Range in Trinidad, and the company said any success from the well will de-risk the basin and could result in "material potential upside" in the block with multiple follow-on prospects and leads to be tested by further exploration drilling in 2015 and/or 2016.
Currently, Range is awaiting regulatory approvals concerning the drill rig for the well from authorities and to hold pre-spud meeting with partners, contractors, service providers and regulatory agencies associated with the well before drilling commences.
The Canari North well will be a vertical well, drilled to a target depth of 5,000 feet over a 50 day period. The well will test for the presence of hydrocarbons in the Gros Morne reservoirs.
The primary target reservoirs are the Lower Gros Morne sands, projected at a depth of 3,510 feet. The Upper and Middle Gros Morne sands may also contain sands that are hydrocarbon bearing. These form secondary and tertiary targets, and are projected to occur at depths near surface and 2,435 feet respectively.
Range's estimate of the P50 unrisked recoverable prospective resource, or the proven plus probable resource of the Canari North prospect is 8.64 million barrels of oil equivalent, with a chance of success of 25% for the Lower Gros Morne sandstone target. Therefore the Canari North prospect has a P50 risked recoverable prospective resource of 2.2 million barrels of oil equivalent.
The company singed an amendment concerning the Guayaguayare Block in May, when Range acquired a stake in the shallow production sharing contract and the deep production sharing contract from Niko Resources Ltd.
Following that deal, Range will hold a 80% interest in the deep contract and a 65% stake in the shallow contract, with the remaining stake of both contracts being held by its existing partner, the State Oil and Gas Co of Trinidad and Tobago.
The shallow contract covers shallow horizons of up to a depth of 5,000 feet onshore and 10,500 feet offshore at the Guayaguayare block, whilst the deep contract covers both onshore and offshore depths exceeding the shallow contract depths.
Previously, Range held an 80% stake in the block and the state-owned company held a 20% stake.
Range shares were trading flat on Tuesday at 0.630 pence per share.
By Joshua Warner; joshuawarner@alliancenews.com; @JoshAlliance
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