DNO International ASA, the Norwegian oil and gas company, provides a drilling and operations update on its activities in the Sultanate of Oman as follows:
The Company has completed drilling of the West Bukha-5 well in offshore Block 8 and is preparing to resume operations on the West Bukha-4 well whose top-hole section was previously drilled.
Results from the initial flow test of West Bukha-5 confirm the presence of oil in the Thamama reservoir, with an estimated flow capacity of 1,500-2,000 barrels per day.
Samples and measurements taken during the initial test flow period indicate an oil gravity of 35 degree API and a gas-oil ratio of 5,000 standard cubic feet/barrel. While these measurements are somewhat uncertain as the well cleanup process has not been completed and only about a third of the cumulative spent acid recovered, they are consistent with the values observed in neighboring wells. Cleanup operations will be resumed and the well put on production later this summer once normal offshore pipeline operations resume.
West Bukha-5 is the first of a three well development drilling campaign in Block 8. Drilled to a total depth of 5,200 meters, including a 700-meter horizontal section with good fracture indications, West Bukha-5 is the deepest yet for the Company in Oman. Three intervals in the horizontal section were acidized and stimulated. The shallower Wasia interval has not been perforated at this stage.
Following completion of West Bukha-4, the Noble Roy Rhodes rig will move to drill a third well on the nearby Bukha gas condensate field.
As reported previously, during a routine pigging operation a blockage occurred in the 12-inch pipeline connecting the West Bukha and Bukha platforms in late March. Efforts to clear the pipeline have been unsuccessful and a decision has been taken to replace a 4.3-kilometer section of the blocked pipeline. Production from the shut-in West Bukha field is now expected to be restored within six weeks. Prior to the blockage, the West Bukha field produced about 7,000 barrels per day of oil and liquids and about 25 million cubic feet per day of gas. Operations at the Bukha field have continued without interruption with daily deliveries of averaging over 20 million cubic feet of gas and 1,000 barrels of liquids.
The temporary halt in production from the West Bukha field will result in lower production volumes in the second and third quarter of the year. Once production is restored and West Bukha-5 brought on stream, the Company believes that the overall cash from Block 8 operations in 2012 should not be materially impacted with the accelerated recovery of the deferred production.