Exxon Announces a New Gas Discovery On Shore in PNG

[petrengr1]

http://news.exxonmobil.com/press-release...new-guinea

[Stavros]

To my opinion, this is a VERY FEEBLE attempt by XOM to make simpletons believe they have sufficient low-cost options for additional gas resources versus acquisition of IOC at a fair price. The PR only says that the sandstone is similar to that at Hides Gas Field, which is 13 miles away.

Santos and OSH issued information to the ASX . They were not nearly as "gushing" and optimistic. They only said that preliminary interpretations indicate hydrocarbons.

HERE IS THE XOM PR:

Exxon Mobil Corporation announced Wednesday a new natural gas discovery in the Papua New Guinea North Highlands, 13 miles northwest of the Hides Gas Field.

The Muruk-1 well encountered similar high-quality sandstone reservoirs as the Hides field and was in line with pre-drill expectations, according to an Exxon statement. The well was safely drilled to 10,630 feet, with evaluations currently underway to determine the size of the discovery.

“We are excited by the results of the Muruk-1 exploration well, which confirms the presence of hydrocarbons in the same high-quality sandstone reservoirs as the Hides field that underpins the PNG LNG project,” said Steve Greenlee, president of ExxonMobil Exploration Company.

“Over the coming months we will work with our co-venturers to better determine the full resource potential,” he added.

“ExxonMobil has been involved in exploration in Papua New Guinea since the 1930s. The Muruk exploration success demonstrates the strength of ExxonMobil’s long-term investment approach and reaffirms its commitment to Papua New Guinea,” Greenlee concluded.
Drilling operations at the Muruk-1 well began on Nov. 2. The well is located in petroleum prospecting license 402, which covers 126,000 acres.

Interest owners in the well are ExxonMobil (42.5 percent), Oil Search Limited (37.5 percent) and Barracuda Limited, a subsidiary of Santos Limited (20 percent, subject to regulatory approval), with Oil Search as operator.


This is what OSH said about the Muruk-1 Well on 8th December.

The Muruk 1 well was spudded on 2 November. During the month, the well was drilled to a depth of 1,742 metres through the Darai Limestone section, with the base of the limestone being intersected 266 metres high to prognosis. A 13-3/8” casing was run and cemented.

At month end, the rig was preparing to drill ahead in a 12-1/4” hole through the Ieru formation.


This is what Santos said today in an ASX Media Release:

Santos today advises that the Muruk 1 exploration well in PPL 402 in Papua New Guinea has reached a depth of 3,130 metres. Following wireline logs, the preliminary interpretation is that the well has encountered gas and condensate within the primary target Toro Formation, and results are in line with pre-drill expectations.

Subject to Joint Venture approval, the rig will commence drilling a geological sidetrack down dip to the north east, to attempt to delineate the hydrocarbon-water contact within the Toro Formation.


This is what OSH said today in an ASX Media Release:


Oil Search Limited, operator of PPL 402, advises that the Muruk 1exploration well has reached a total depth of 3,130 metres. In line with the pre-drill prognosis, reservoir quality sandstone has been encountered in the primary objective (the Toro Formation). Log data acquisition over the reservoir interval has been largely completed, with preliminary interpretation of this data indicating that the reservoir contains gas with condensate, with no hydrocarbon-water contact observed.

Subject to Joint Venture approval, the rig will commence drilling a geological sidetrack down dip to the north east, to delineate the hydrocarbon-water contact within the Toro Formation.

The Muruk discovery is close to MNG LNG infrastructure and is located between the Hides and Juha gas fields.

[thg]

OSH is claiming a $14Bn resource estimate, withing two days of their previous announcement (that they have indications of hydrocarbons).

Ok, they made the initial announcement of a discovery only 2 days ago. The well "Muruk-1" spudded on 2 November, and has already reached 10,630ft. ... and in that 2 days they have estimated the resource to be bigger than Elk/Antelope at $14Bn. 



Exxon's own press release on December 28 states that "Over the coming months we will work with our co-venturers to better determine the full resource potential."



Lets put this in perspective:

1) Elk and Antelope fields have had massive (no hyperbole whatsoever) flow tests.

2) Elk and Antelope fields have had a significant amount of testing in addition to the flow tests

3) Elk and Antelope have had further exploratory drilling over 9 years since the initial discovery to further deliniate reservoir boundries.

On the other hand..

1) Muruk-1 was spudded on 2nd November, 2016 (less than 60 days)

2) Exxon and OSH announced "possible hydrocarbons" on 28th December, 2016

3) In Exxon's 28th December PR, they stated "Over the coming months we will work with our co-venturers to better determine the full resource potential."

But OSH goes on record yesterday and states that they have a $14Bn resource. months turned into a day in order to achieve what precisely?

http://www.theaustralian.com.au/business...5c3ddd756c

A cynical person might say that this was just a ploy to undermine a fair compensation for the stakeholders in the InterOil assets, and this could just be a method for conning the Shareholders, Government, and Land Owners out of a LOT of money.