14-Hardy plans six exploration wells in next 10 months

Vol 9, PW 22 (23 Feb 06) Exploration & Production

Hardy Oil has a busy time ahead.

Over the next ten months the UK-listed company and its partners are planning six exploration wells across three blocks: Two at CY-OS/2 in the Cauvery Basin - where it is operator with 75% with GAIL holding 25% Two at GS-OSN-2000/1 in the Saurashtra basin where Reliance is operator with 90% and Hardy holds 10% Two at KG-DWN-2001/1 in the Krishna Godavari basin where Reliance is also operator with 90% and Hardy holds 10%. Most promising is NELP-III block KG-DWN-2001/1 - located near world-class discoveries by Reliance and Gujarat State Petroleum to the west and north.

3D has confirmed the presence of two distinct and extensive four-way structural closures, said Hardy on 9th February. 3D has also revealed a number of seismic amplitude anomalies within these structure closures.

Under scrutiny is 4000-sq km of fresh 3D shot by Western Geco at KG-DWN-2001/1, which according to Hardy, is in the final stages of processing. Says an analyst: Its not possible to speculate on how positive this is until you have drilled a well.

What is certain is that a structural trap has been found and the probability of oil or gas migrating into the trap is high. But it could just as easily be water.

First exploration drilling at KG-DWN-2001/1 is expected in mid-2006 and Phase-I ends in April 2007. Hardy is equally enthusiastic about a second Krishna Godavari block (KG-DWN-2003/1) won in NELP-V where Reliance has committed 2100-sq km fresh 3D acquisition and six exploration wells during the four-year Phase-I work programme beginning next year.

This area is widely regarded as one of the most exciting offshore exploration areas in India and was heavily contested in the recent bidding round, adds Hardy. On 9th February, Hardy raised آ£14.7m ($25m) through a placement of 5.2m shares at آ£2.83 per share double its flotation price of آ£1.44 per share when the company listed on the Alternative Investment Market of the London Stock Exchange in June last year.

Placement was completed on 10th February, confirms Hardy. It was well received and oversubscribed.