Crux-3 was spudded on Friday night using the Sedco 703 rig and is the first of three wells to be drilled back-to-back in the greater Crux area over the next three months.

Nexus, which holds an 85% equity share of the AC-P23 exploration permit, is drilling the wells ahead of a likely final investment decision on the Crux liquids project expected mid-2008. Japan’s Osaka Gas holds the remaining 15% of the project.

Two of the three wells will be drilled in AC-P23 to appraise the Crux field while a third well will be drilled in the adjoining AC-P41 exploration permit in which Nexus holds a 50% interest, to test the Libra exploration prospect.

Crux-3 is located in the core area of the Crux field to evaluate the thickness of the main Nome formation reservoir section which, based on seismic data, is estimated to be thicker than currently mapped.

The well will test the potential for the younger Plover formation, intersected in both the Crux-2 and Crux-2 ST1 wells, to extend toward the southwestern part of the field.

Nexus expects to production test Crux-3 to gain additional information about condensate properties, required to finalise the design of the production facilities and for marketing of the condensate.

This well will be immediately followed by the drilling of the Crux-4 appraisal well to evaluate the reservoir thickness in the southeastern part of the Crux field.

Both appraisal wells have been designed to have the capacity to be suspended as future production wells.

In October, Gaffney Cline and Associates released a report assessing the Crux project to contain 66.3 million barrels of reserves at the P50 level of confidence.

At the time, Nexus said this figure was sufficient to support the commercial development of the project.