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- Contingent resources assigned to both oil sands discovered by Zydeco-1
- Gross best estimate of 48,000 barrels for the Borsum Sand and 40,000 barrels for Homeseeker B
- High estimates of 60,000 and 50,000 barrels respectively
- Both discoveries sit next to proven production from the same sands
Gulf Stream Energy (ASX: GSE) has highlighted the commercial upside of its two oil discoveries made with the Zydeco-1 sidetrack at the Zydeco Oil & Gas project in Louisiana.
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The Borsum Sand and Homeseeker B discoveries was first announced on 15 October and in the 10 days since,the company’s external evaluator has completed a draft contingent resource assessment of both sands and the operating team has prepared a completion AFE for Homeseeker B.
Analysis has estimated maiden contingent gross best estimate (2C) of 48,000 barrels for the Borsum Sand and 40,000 barrels for Homeseeker B, with high estimates (3C) of 60,000 and 50,000 barrels respectively
“Zydeco-1 was drilled for gas and has delivered two oil discoveries on the way down – and within 10 days of running the logs both carry contingent resources. That is exactly the kind of near-term, low-cost optionality we set out to build on the Gulf Coast,” MD, Joseph Graham, said.
“Homeseeker B is the immediate prize. The casing is already across the zone, the completion design and AFE are done, and the nearest offset – 300 feet away – tested this same sand at 75 barrels of oil a day.
“Our focus is to get the well flowing, prove up the reservoir and move to first production as quickly and as cheaply as the engineering allows.
“The Borsum Sand sits behind pipe as a second completion, and the Tweedel – the main event – is untouched 380 feet below our shoe. Any decision to proceed will be guided by the flow-test results, completion requirements and economics.”
The immediate priority is to complete and flow test Homeseeker B. A completion AFE has been prepared and the work can be executed with a workover rig on the existing cased wellbore. The flow test and fluid samples will confirm producibility and provide the data needed to progress the resource towards reserves.
The Borsum Sand can be completed later from the same wellbore as a second, shallow production zone. No approved development plan or completion decision is yet in place; the Board expects to make the Homeseeker B completion decision shortly and will update the market when it does.
GSE was steady at 0.2¢. Mkt cap $4.038M.
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