Minor partner Horizon Oil (formerly Bligh Oil and Minerals) reports that the semi-submersible Ocean Bounty rig has encountered a shallow 10m thick and possibly oil-bearing high resistivity sand.

This 1240m-deep interval is thought to be the M2A sands, which have been penetrated and found to contain commercial oil in previous wells drilled in the field.

The maximum thickness of the M2A sands encountered in the Maari-1 and Moki-1 wells had been 5m, so double the thickness may mean another target for the Maari partners to investigate.

"The thicker sand package in Maari-2 may significantly increases the reserves within the M2A and render them a development target, alongside the main Moki reservoir," said Horizon, which recently bought a 10% stake in PEP 38413 from licence operator OMV New Zealand.

As well, the top of the Moki formation has been found at 1303m, some 12m higher than prognosed. This may mean the Moki reservoir is bigger and contains more hydrocarbons than previously thought, say industry commentators. The Ocean Bounty is currently preparing to core the Moki reservoir.

A positive result for this appraisal well, Horizon says, could mean future development of the field involving horizontal producers, supported by gas lift, horizontal water injectors, subsea wellheads and a floating production storage and offloading (FPSO) facility. Development expenditure, assuming the leasing of the FPSO, is estimated to be about $US115 million. First production could occur in 2005 at an initial rate of about 30,000 barrels of oil per day.

Horizon currently estimates proven and probable reserves in the Moki Formation of the Maari Field to be 35 million barrels of oil and believes there is potential for a further 16 million barrels of oil in other sands at Maari and Manaia.

A 500 sqkm 3D seismic survey had already been shot over PEP 38413, including the Maari and Manaia structures, which were simple dip-close anticlines at all reservoir levels with top seal provided by interbedded marine shales.