Lofin Discovery

Lofin Discovery

Lofin-1

An exploration well, Lofin-1 was spudded within the western part of the Seram PSC in January 2012 to test the hydrocarbon potential of the Manusela Formation. In May 2012, the well was side-tracked at 3,416.3 metres Measured Depth (MD) and drilled to a total depth of 4,428 metres MD.  At total depth the well was interpreted to still be in hydrocarbons representing a current interpreted hydrocarbon column of 160m.  The well flowed gas and oil/condensate (in part stimulated by acidising) at a rate 15.7 MMSCFD and 171 BPD of 36.1 API oil/condensate, with a flowing wellhead pressure 4,750 psi on 24/64 inch choke.  The well could not be drilled deeper to test the extent of the hydrocarbon column due to rig capacity restraints.
 
Downhole shut in pressure data acquired during testing operations indicate potential for a significant hydrocarbon column below the total depth of the Lofin-1 well.
 

Lofin-2

In order to appraise the Lofin-1 discovery, the partners in the Seram Project approved the drilling of the Lofin-2 well which subsequently spudded on 31 October 2014.   Lofin-2 had a planned total depth of 5,425 metres, with the primary objective Manusela Formation projected at 4,488 metres.  The primary objective was intersected at 4,615 metres, some 125 metres deeper than prognosed.  The well was drilled to a revised total depth of 5,861 metres after wireline logging indicated that the hydrocarbon column could extend to this depth.  Encouraging gas shows were encountered to approximately 5,595 metres and some oil shows continued to be recorded while drilling through to the revised total depth within the Manusela limestone.
 
Whilst pulling out of the hole after reaching total depth, the tool string became stuck and subsequent jarring attempts to free the stuck pipe resulted in the string parting, leaving a section of drill string (fish) in the hole.  Attempts to recover the fish were unsuccessful.
 
Testing of a restricted open hole section of Lofin-2 above the fish commenced on 21 May 2015 with the well flowing gas at up to 17.8 mmcfpd through a 52/64" choke at approximately 2,250 psi flowing pressure for approximately 100 hours. The well is also flowing some water, interpreted to be flowing past the fish, from the lower part of well below the substantial gas column.  A four rate flow test was performed during the final approximately 40 hours of the flow period.  The total flow period was approximately 7 days and provided valuable reservoir engineering data.
 
The program to suspend the well as a potential future gas producer was commenced and completed with rig release on 19 July 2015. The Lofin-2 results confirm a material gas discovery for the Lofin structure and the joint venture is working on appraisal and development options.

Contingent resources1 (2C Best Estimate) compiled by Lion for the Lofin discovery are 2020bcf gas and 18.25mmbbl condensate (100% basis). Lion 2.5% working interest share of 2C contingent resources is 50bcf gas and 0.46mmbbl condensate.
 
(1Contingent Resources those quantities of petroleum estimated, as of a given date, to be potentially recoverable from known accumulations by application of development projects but which are not currently considered to be commercially recoverable due to one or more contingencies. Contingent Resources are a class of discovered recoverable resources. There is no certainty that any portion of the contingent resources will be developed or, if developed, there is no certainty as to either the timing of such development or whether it will be commercially viable to produce any portion of the resources.)