In a drilling update, Arc said the results had confirmed a significant hydrocarbon system in the Fitzroy Trough of the greater Canning Basin, as well as reservoir quality sands and high quality shale seals.

Since last week, the well has encountered several strong mud gas peaks over the interval 2240m to 2470m.

This prompted Arc to run intermediate wireline logging over the gross open-hole interval 809m to 2589m. The logging analysis indicated porous (15%) and permeable sandstones in the Lower Anderson Formation at a depth of 2100-2260m.

“However, interpretation of the electric logs and MDT results indicates low hydrocarbon saturations and that the shows are likely to be residual hydrocarbons, including the strong mud gas shows at 2240 metres to 2260 metres,” Arc said.

“These Lower Anderson sands and their lateral equivalents are the primary target of the Stokes Bay-1 well, which will target them in a crestal location on the structure.”

Meanwhile, Arc said the strong mud-gas shows in the deeper Laurel Fm (2400m to 2470m) were interpreted to be associated with a series of organic rich tight carbonates and shales.

With the logging complete, Arc was yesterday morning drilling Valentine-1 ahead at a depth of 2695m towards the Virgin Hills primary objective, due to be intersected at 3222m.