The news sent the company's share price soaring up 13% in morning trade after it emerged from a trading halt, however logging still needs to be done to determine the significance of the finds recorded to date. It is now up almost 9%.
Melbana said the 8½ inch hole section has been drilled through the Vega Alta seal and is currently at a depth of 3200 metres within the first of the primary targets - known as the N Sheet.
Strong oil shows have been recorded within the unit and free oil has been observed within the mud system at surface along with elevated mud gas readings and associated hydrocarbon fluorescence of up to 95%.
The high quality shows have been recorded at a measured depth of 3055-3200m to date, over a gross interval of 145m. The shows also contain zones with good indications of fracturing, according to Melbana.
There was also fluorescence starting at 2900m with some oil samples and on shakers from 2960MD the company said.
Melbana has completed a wiper trip and is now continuing to drill through the N Sheet toward the prognosed base of the interval expected at 3400m.
The next primary target is the Alameda limestones, penetrated by a previously drilled well, Marti-5, which recorded significant oil shows from the interval and hydrocarbon recoveries were reported.
The limestones are interpreted to be separated from the current N Sheet by a thrust fault and another repated of the Vega Alta seal.
The company noted the area's complex geology and poor data quality meant they were bound to encounter some unexpected results, after it encountered 670m of oil at a depth of 454m early in the drilling process.
However Melbana said the benefit of this is that finding even a think oil column in the N objective at the current location could indicate a significant resource updip of the well bore.
Melbana executive chairman Andrew Purcell said the level of accuracy of predicting target depths of objectives was expected to be quite low.
"Therefore, the intersection of what is believed to be the "N" objective limestones at very close to the prognosed depth is very impressive indeed," he said.
"We are very encouraged by what this well has told us to date, particularly given we have encountered oil shows now over two significant intervals with this latest area also having significant gas influx, which is a good sign that any reservoir may be well charged.
"Subsequent logs and studies will tell us the significance of what we've encountered but given the size of these structures it allows for the possibility of a material accumulation of oil."
Alameda-1's development has been a long journey for the company which has been progressing its Cuban project, held under a PSC with the government, as it searched for a farmin partner, finally securing Angola's Sonangol in 2020.
Melbana shares are up 9% to 2.5c.
