Hardyآ’s high-risk exploration strategy at CY-OS/2

Vol 10, PW 10 (07 Sep 06) Exploration & Production

All eyes are on Hardy Explorations high-risk two-well exploration programme at pre-NELP exploration block CY-OS/2.

As we write jack-up Deep Driller-1 from Premium Drilling is nearing TD at the first well on the block, where operator Hardy holds 75% and GAIL holds 25%. Spud on 23rd July, Deep Driller-1 is targeting Tertiary and Basementformations to 2500metres below the seabed, which it hopes to reach this month.

On completion, Deep Driller-1 will spud a second well 20-km away from the first over 35 days before heading off to (operator) Reliances exploration block GS-OSN-2000/1 in the Saurashtra basin off the west coast of India, where Hardy holds 10%. Hardy tells us results of the two-well drilling programme at CY-OS/2 will be announced in the fourth quarter of this year.

Hardy is taking a big risk with these (CY-OS/2) wells, says a source. These are stratigraphic playswithhigh risks on reservoir closure.

But if you do find something,it could be quite large. Last year Hardy lobbied successfully with the oil ministry to beat off attempts to strip it of CY-OS/2.

On 24th May 2005, it won a 22-month extension to the 7-year work programme till 15th March next year (2007) after promising an additional well and 330-sq km fresh 3D. Reliance, meanwhile, has accepted Hardys offer to take over Deep Driller-I after its two-well programme at CY-OS/2 so it can resume its exploration programme at GS-OSN-2000/1.

In May this year, well GS01-A1 at GS-OSN-2000/1 successfully revealed 40% gas to surfaceand high pressuresbefore Reliance was forced toplug and abandon the welldue towell mechanical problemsand a low 10,000-psi rated BOP on the Transocean rig Actinia. By contrast Deep Driller-1 from Premium Drilling is a new rig on its first assignment after construction in Singapore.

Crucially, it has a higher 15,000-psi BOP rating, making it ideally suited for GS-OSN-2000/1, where Reliance plans a second well.

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