The Board and Management of Austin Exploration Limited (Austin or the Company) are pleased to announce that the Company’s Magellan #1 well has now been successfully drilled and perforated production casing has been run in the Pierre formation in preparation for flow testing.
Multiple oil shows were evidenced whilst drilling through Pierre formation, with a steady flow of oil being returned to the surface in the drilling pits. These oil shows confirm that Austin’s highly advanced pre-drilling well-site selection process, using a combination of 3D seismic, surface geochemistry and satellite imagery studies, has been accurate in detecting sub-surface fractures that contain oil within the Pierre formation.
The Company has immediately started mobilising the rig to its Marco Polo # 1 well and drilling operations of the deviated well bore will commence here in the coming days. The deviated well-bore has been designed to intersect multiple fracture networks and to maximise the potential pay-zone thickness of the reservoir in this well.
The Company is currently progressing a back-to-back drilling program with the drilling of three wells: the Magellan #1 well, the Marco Polo #1 well and the Columbus #1 well. These three wells are targeting oil production from the Pierre Shale formation.
The multi-well program has been designed to significantly reduce drilling costs and maximise operational efficiencies. The Company is able to achieve this due to its strategic and comprehensive Atlas Copco RD20 drill rig fleet rental agreement with Math Energy Drilling, where high daily rig rates and standby rates are not being incurred.
The three well program is being conducted in three phases:
Phase 1 – Sequentially drilling the upper vertical sections on the three wells – SUCCESFULLY COMPLETED
Phase 2 – Sequentially drilling the deviated well bore sections on the three wells – UNDERWAY
Phase 3 – Sequentially flow testing the three wells – NEXT PHASE
The drilling of the Magellan # 1 well has confirmed that an active crude oil hydrocarbon system is in place directly to the west of the Florence field where more than 15 million barrels of oil have been produced from the Pierre formation. The Pathfinder property was held for coal mining prior to Austin’s acquisition and the Company believes that the oil in its property remains in virgin territory.
Austin is the operator of the Pathfinder project and controls a 100% working interest that covers 15,282 gross acres. The property lies over the DJ Basin which is one of North America’s most prolific oil and gas basins.
The Company looks forward to sequentially flow testing the three wells and updates of the drilling program will be released to the market as they occur.