LONDON (Alliance News) - Roxi Petroleum PLC Wednesday said it has found oil and gas at the A5 well on the BNG Contract Area, situated on the edge of the Caspian Sea in western Kazakhstan near two major oilfields.
The Kazakhstan-based oil and gas company said the well, which was the first deep well in the area, has detected oil and gas shows at a depth of 4,332 metres with core samples being taken shortly to determine to full size of the horizon.
The A5 well had a planned total depth of 4,700 metres and was initially targeting a middle carboniferous formation at 4,390 metres depth.
"We are naturally delighted with these early indications and look forward to quantifying what has been discovered in the coming days and weeks," Chairman Clive Carter said in a statement.
In January, the company announced that it had resumed operations at the A5 well, which is the first of five major deep wells at the site, after initial delays to deep drill testing after unexpected permitting problems.
Roxi has a 58.41% interest in the BNG Contract Area.
Two of the largest oilfields in the world are near the BNG Contract Area. The Tengiz field, just 40 kilometres away, is owned by Chevron, Exxon Mobil, Lukoil and the Kazakhstan government, and has an estimated 25 billion barrels of oil originally in place.
The Kashagan oilfield in the Caspian Sea is considered the world's largest discovery in the last 30 years when combined with the Tengiz Field, and is owned by an international consortium including Eni, Royal Dutch Shell PLC, Total SA and ExxonMobil. It holds and estimated 13 billion barrels of recoverable reserves and will soon begin initial production at 370,000 barrels of oil per day.
Following the Tengiz discovery, the major Caspian Pipeline consortium pipeline was opened to export oil to the Black Sea port of Novorossiyk in Russia and the Kashagan Field has been designated as the main source of supply for the major Kazakhstan-China oil pipeline.
Kazakhstan is also considering further routes like the Trans-Caspian Oil Pipeline through Azerbaijan, Georgia, Turkey or through Iran to reduce its dependence on Russia.
Roxi Petroleum shares were up 88% to 7.50 pence on Wednesday, putting it top of the AIM All-Share risers in early trading.
By Tom McIvor; tommcivor@alliancenews.com; @TomMcIvor1
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