Thoughts After Operations Update - by/Ok-GeodesRock4930 Mar 2021 15:50
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1.) Update - Details
The Nanushuk Formation, which contains the primary targets for the Merlin-1 well, was encountered ~600’ low to prognosis and is interpreted to be ~500’ thicker than that encountered in the wells drilled into the Willow Oil Field (“Analogue Wells”) to the north of the Project Peregrine acreage. Encouragingly, the gamma log indicates the presence of more sand packages than those in the Analogue Wells and that the sand packages in Merlin-1 are generally cleaner in nature. Reservoir quality will only be known once analysis of the wireline logging is complete.
The fact that the geological formation came in 600 feet low to prognosis is not a concern. The top depth was estimated from 2D seismic. They just had to drill deeper to find it - hence the delay (?). What is new and encouraging, IMO, is that the potential reservoir rocks gained substantial thickness. The original premise for the prospect was to find turbidite fan sandstones near the shelf edge. The only way the sediments could be thicker is find the sediments further towards the fan deposits slightly of the shelf edge and going downslope - i.e., a progressive sand build up. That creates an environment of greater sediment deposition and reduction of shales and clay -- SO a very very good thing.
2.) Update - Details
Oil shows were recorded over multiple intervals in the Nanushuk while drilling Merlin-1, including the primary targets. Fluorescence ranged from relatively weak to moderate “dry” fluorescence with slow to moderate sometimes fast streaming cut when exposed to solvent (see Fig. 1). Mud gas peaks were also recorded and, although generally not of the same scale of the increase in total gas above background as that seen in the Analogue Wells, one of the prospective horizons in Merlin-1 did have substantially elevated total gas, similar to that in the Analogue Wells. Heavier gas components, including C5, were observed over multiple intervals. Resistivity was elevated over these intervals and is encouraging, particularly in the context that the Nanushuk is considered a low resistivity play type.
The mention of oil shows were from the Hydrocarbon Mud-Logs. The description and images in the update are identical with to examples I posted as to description and evidence. The Bright White fluorescence seen in the images is indicative of a very high quality of crude oil, along the lines of 40-45 API gravity. The mention of background gas being and the the interval that recorded higher peaks is encouraging because it indicates low gas saturated oil vs. a gas only interval. The C5 gas component is Pentane, more common in oil.
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