Strong volumes have pushed the Arc price over 57 cents, even after Tap dropped the takeover bid that sparked Arc's share price run recently. There was some speculation that the price would drop along with the takeover bid.
Arc told the market on Friday that it will be testing as planned the continuity of the Dongara/Wagina reservoir encountered in Hovea-1 in a crestal location, in order to help quantify the oil in place and the recoverable reserves in the Hovea oil pool.
In addition, it will try to obtain as much reservoir information as possible from the Dongara/Wagina oil pool by an extensive coring and logging program.
Arc also told the market it would test the deeper section, which includes a number of multiple objectives with the potential to hold substantial quantities of hydrocarbons.
These include the Irwin River Coal Measures, the High Cliff Sandstone, potential sands in the Holmwood Shale and a possible basement wash.
According to Arc, the Irwin River section has not been tested in the Hovea area but is productive at the Dongara Field some 6km to the north and at the recent offshore Cliff Head discovery. The formation also recorded good hydrocarbon indications at the Woodada-19 well.
"Arc's estimation is that there is the potential for the Irwin River section to hold in excess of 100 billion cubic feet of recoverable gas if the structure is gas filled, and in excess of 40 million barrels of recoverable oil if the structure is oil filled," Arc told the stock exchange.
In order to improve the accuracy of reserve estimates and allow more efficient development planning, Arc said the Hovea-2 vertical well will try to locate the Mountain Bridge Fault near the crest at the Dongara/Wagina Sandstone level.
Arc said the current interpretation of the Mountain Bridge Fault indicates that the Dongara/Wagina Sandstone will either not be encountered or may be partially removed by the fault in the vertical well.
As a result, after it has been logged and evaluated, the vertical part of the well will then be plugged back and then sidetracked, Arc told the exchange.
