SDX Energy said drilling on the SD-1X on the South Disouq concession in Egypt has reached its second target depth.
The well has been drilled to a total depth of 11,068 feet, with hydrocarbons present in the deeper intervals, suggesting a working petroleum system within the section.
The company expects that hydrocarbons present in deeper intervals could indicate the presence of petroleum system within this section. Apart from this, there are confirmations on the presence and quality of reservoir intervals within this section. But, there is not sufficient amount of hydrocarbons present to justify completing the interal.
The well in Abu-Madi is about to be completed and the rig will released, shortly after. After the release of the rig, a detailed testing programme could take place related to the information about Cretaceous horizons in the area, which will allow SDX and its partners to explore its potential within the 1,275 km2 South Disouq concession.
The company plans to release updates on the Abu-Madi section gas discovery and associated recoverable estimates of volume in the coming weeks.
SDX President and CEO Paul Welch said: "Whilst it is disappointing not to have made a second commercial discovery in SD-1X's deeper target, evidence of a working petroleum system within this interval is extremely important to the prospectivity of the concession.
“The Cretaceous units are laterally extensive within the block and we have already identified several locations where this potential can be further tested. Meanwhile, we have an excellent gas discovery in our primary target, the Abu-Madi, and view the well results as a very significant success. Our objectives now are to test this upper interval and then get the field developed and on production in the shortest possible time frame.
"We are excited about this discovery, which adds a new asset to SDX's growing portfolio. Success here, combined with the extension of several of our permits in Morocco, where further drilling will take place later this year, puts us in a strong position to grow our production base in the near term. We remain firmly on track to deliver additional shareholder value in 2017 and beyond."