Junior partner Horizon today said the Wei 12-7-1 exploration well, in which the company has a 30% working interest, had reached its 1795m total depth after encountering strong hydrocarbon shows in both the primary Weizhou and secondary Liushagang formations.

However, preliminary interpretation of logs indicated those intervals to be water bearing and, subject to that information being confirmed, the well would be plugged and abandoned.

The Nanhai IV jack-up rig would then move to drill the Wei 12-8-3 appraisal well in the 12-8 East (12-8-2) field, approximately 8 km east of the current well location. Horizon’s consultants expected the 12-8 East field to have technically recoverable proven and probable reserves of 27 million barrels of oil.

Horizon chief executive Brent Emmett said he was particularly disappointed with the result of the 12-7-1 exploration well, which the company had rated highly.

However, he stressed that the reserves and economics of the potential development plan for the 12-8 East and West fields previously presented to shareholders was independent of the results of exploration drilling such as at 12-7-1.

“Exploration success has not been included as part of the base development plan and success at other exploration prospects on Block 22/12, if it occurs, will be an upside to that plan.”

Interests are Roc Oil 40%, Petsec Energy 25%, Horizon Oil 30% and First Australian Resources 5%.