Touchstone Exploration Share News (TXP)

(Sharecast News) - Touchstone Exploration updated the market on results from the first production test at its Royston-1 exploration well on Monday, and provided data from the second test, both of which confirmed separate light oil discoveries.


The AIM-traded firm said the first and deepest Royston-1 completion and exploration test was designed to evaluate an interval at the bottom of the well in the intermediate sheet of the Herrera Formation.

It said the completion spanned a 92-foot gross interval below 10,434 feet, which was identified on wireline logs as being hydrocarbon-bearing.

Following completion and a brief clean-up period to recover load fluid, the well was shut-in and built to a pressure of 3,150 psi at surface.

The company said the interval subsequently flowed up 3.5-inch tubing on a variety of choke sizes between 16/64 inches and 40/64 inches, at rates up to 550 barrels per day.

It said the recovered oil was light, sweet crude with an average 33-degree API, with sampling throughout flow testing indicating an average 94% oil cut with some solution gas present, but not measured.

The configuration of the downhole assembly was not optimal for testing light oil, given it was designed to test a potential liquids-rich gas interval.

"While we worked to suspend the initial production test to move uphole for the second test, the well continued to flow significant volumes of crude oil at high pressure from the intermediate sheet, and heavyweight mud was required to control the well before proceeding," the board said in its statement.

Touchstone said it completed its second production test in the lowermost portion of the overthrust sheet at depths between 9,878 and 10,148 feet, with a gross 270 feet of section perforated.

"Test two has established a light oil reservoir in the overthrust sheet of the Herrera Formation with flow rates of up to 430 barrels per day of total fluid observed.

"Testing indicated light, sweet crude oil with an average 30-degree API, while build-up testing indicated a bottomhole reservoir pressure of 7,098 psi."

The company said solution gas was also present on the test, but was not measured.

It said the downhole assembly for the test was designed for a liquids-rich natural gas test, and again included the use of 3.5-inch tubing, which was not ideal for the actual conditions encountered following completion.

Unlike results from the first production test, during the second test the lower portion of the overthrust sheet produced with high water cuts averaging 90% throughout the flow test.

Touchstone said it designed the completion with multiple intervals where production could be isolated and, in the future if a smaller tubing string was employed, it said it could segregate the interval to maximise crude oil production.

"We are excited to announce this further, large oil discovery at Royston-1," said president and chief executive officer Paul Baay.

"The results are the reason why we find the geology in Trinidad's hydrocarbon charged basin so exciting.

"This oil discovery will allow us greater flexibility for the pace of development of the project, as we have the opportunity to design production facilities while we are selling crude oil testing volumes."

At 1431 GMT, shares in Touchstone Exploration were down 14.23% at 114.5p.