Niko upgrades D-6 in-place gas to 35.4-tcf

Vol 10, PW 5 (29 Jun 06) Exploration & Production

Niko Resources has quadrupled its estimates of in-place gas at block KG-DWN-98/3 to 35.4-tcf.

In a statement on 27th June, Niko said the upgrade emerges from an independent engineering report prepared by Gaffney, Cline & Associates in January 2006 for Reliance (90%). Niko said the high estimate of gross original natural gas in-place for the block, which was used as the basis for estimation of reserves and contingent resources, has been increased to 35.4-tcf from the figure of 11.9-tcf submitted by DeGolyer & MacNaughton a year earlier.

Niko said two development wells A-10 and B-7 drilled in 2005-06 to secure further reservoir and reserve information for the development programme led to upward revision of reserves and productivity figures. Niko said new discoveries were made in 2006-06 from wells P-1A and MA-1.

Both wells discovered hydrocarbons in new intervals that could lead to significant new reserves in D-6, said Niko. There are numerous geologic anomalous features in D-6 that contain oil and gas potential.

Niko said drilling so far has led to 18 consecutive discoveries on D-6 and that with the recently shot 3474-sq km 3D seismic, almost the entire block has been covered with 3D. Processing is scheduled to be completed in August 2006 with interpretation and justifiable well selection to follow immediately.

Niko says there are plans to spud well MB-1 (a scheduled Cretaceous test well) in July. Niko said the P-1A well yielded gas in the Miocene and Pliocene sections.

This further opens up the exploration potential of deeper water areas of D-6 as the Miocene level is expected to increase in importance as the main interval for hydrocarbons. Niko said the Miocene interval has the potential to produce oil and gas as seen in other areas of the KG basin.

In 2006-07 three rigs will be drilling on D-6, to develop and evaluate oil and gas potential on the block. Exploration drilling will continue, with initial focus on evaluation of Cretaceous oil potential.