The La Playa Mid Frio Unit #1 well on the La Playa Deep prospect will target a three way fault trap with a Middle Frio sandstone objective.
The well is designed to test a number of structural closures between approximately 11,800 ft and 14,100 ft total vertical depth (TVD) with pre-drill analyses suggesting a central reserve estimate of 130bcf of recoverable gas, with over 500bcf at the upper end of the range.
There are several producing Middle Frio fields in the vicinity of La Playa Deep which are considered geologically similar. The nearest of these is the Stirrup field which was completed offshore in August 2002 at a rate of 14mmscfd. Cumulative production to date is 4.3 bcf.
Under the turnkey drilling contract, the total cost for drilling the well is US$3.8 million (US$2.66 million net to Novus). Given the exploration investment economics and this level of financial exposure, Novus withdrew La Playa Deep from the current farmout campaign and is drilling the well at a 70% working interest.
The La Playa Deep prospect is the first of a six well program that Novus is planning at Padre Island during 2004. The next planned well in the drilling campaign is a redrill of the Murdock Deep prospect.
"The program will continue on the basis of 'business as usual' despite the unsolicited bid for the company which was received yesterday. In the event of success of course, a discovery in any of the Padre Island Deep Shelf gas wells could substantially alter the valuation base of the company," said Dr Bob Williams, CEO of Novus Petroleum.
The participants in the La Playa Mid Frio Unit #1 well are Novus Petroleum (operator) 70%, Mitsui Oil Exploration Co 20%, and Golden Gate Resources Ltd 10%.
At the end of December Novus finalised its acquisition of a 100% working interest (WI) in East Cameron tracts 317 and 318, offshore Louisiana and a 79% WI in Main Pass tracts 64 and 65, offshore Louisiana.
The assets were acquired for a combined purchase price of US$25 million with gross production from the properties at 10mmscfd and 600bopd, with combined proved reserves of 33.4bcfe of which 88% are natural gas.
