Hardman has completed a successful testing campaign at the Mputa-1 discovery well. The upper sand interval has now been tested on natural flow. The test results prove not only that the oil at Mputa is mobile, but also that the reservoir sands are capable of producing dry oil under natural flow at potentially commercial rates. The latter aspect is particularly significant, given that the Mputa reservoirs are at shallower depth, and are hence at lower pressure and temperature than the corresponding reservoir units at Waraga. This positive test result therefore expands the operating envelope over which typical Waraga and Mputa crudes (32 ° API) can be produced and eliminates pre-test concerns over oil viscosity and fluid properties at these shallower depths.
Although laboratory confirmation is still awaited, the gravity of all oil flowed at Mputa is similar to that found in the lower units of the Waraga-1 well and is likely to be of similar origin. The Mputa-1 well is located 220 kilometres northwest of the Ugandan capital Kampala and 8 kilometres from the shore of Lake Albert. The Waraga-1 well is located 19 kilometres to the northeast of Mputa-1.
This concludes the testing programme at Mputa-1. The well is presently being suspended and the rig and test crew are being stood down. Initial guidance on volumes will be included in the company’s Half YearlyReport on 29 August 2006.
Hardman Resources Managing Director and CEO, Simon Potter, commented: “The positive test results from Mputa are particularly important given that we map more oil in place in this resource than at Waraga. Natural flow from the reservoir at these pressures and temperatures are indicative that production rates could potentially be commercial. Further, collectively the results to-date indicate that oil from the source interval deep under the lake can migrate all the way across the rift valley to the boundary fault and thus potentially over the whole licence, considerably upgrading remaining prospectivity. The joint venture has presented potential forward options to the Government and is currently in discussions concerning the way forward on each of exploration, further appraisal and potential development concepts.”