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Karoon strikes oil pay at Kangaroo-2 in the Santos Basin off Brazil

26th November 2014

Karoon Gas has discovered multiple oil bearing zones at its operated Kangaroo-2 appraisal well, where drilling had been completed at a total depth of 2,369 metres below rotary table (mRT) and a wireline logging programme is underway

Karoon strikes oil pay at Kangaroo-2 in the Santos Basin off Brazil
The gross oil column thickness totals 250 metres, and no gas cap was penetrated

Five separate oil bearing reservoir sand intervals over the interval 1,660mRT to 2,000mRT in the Palaeocene and Maastrichtian age formation have been penetrated with each interval having a separate oil/water contact.

The gross oil column thickness totals 250 metres, and no gas cap was penetrated.

Work is continuing to assess the impact of the well results on the contingent resource size given the absence of an anticipated gas cap and the impact of shallower oil water contacts in some of the sands.

Following further analysis of biostratigraphic data the previously reported Eocene age of the reservoir has now been confirmed as of Palaeocene age.

The Palaeocene section contains a 90 metres gross oil bearing reservoir with a net to gross over 70 per cent and porosities in the range 26 per cent-34 per cent. Three separate oil columns are present with sampling estimates of 40 degree API oil with a GOR of 500 scf/bbl.

These Palaeocene oil accumulations are separate from that seen in Kangaroo-1.

The Maastrichtian section contains two oil bearing reservoirs. At the top of the Maastrichtian an 85 metre gross oil bearing reservoir interval has a net to gross over 60 per cent and porosities in the range 22 per cent-26 per cent. The lower Maastrichtian oil bearing reservoir interval has a thickness of 75 metres, a net to gross of 25 per cent and porosities in the range of 21 per cent-25 per cent. Oil recovered from the Maastrichtian reservoirs is estimated to be 40 degree API with a GOR range of 550–700 scf/bbl.

Water pressure data at Kangaroo-2 shows a common pressured aquifer as seen in surrounding wells. Wireline logging is expected to be completed over the coming days. At that point a production test is planned with an option to sidetrack and core being considered subject to final logging results.

All operations on the well are expected to be completed within the next four weeks before the rig moves to drill and evaluate the Kangaroo West prospect approximately 2 kilometres distant on the western side of Kangaroo salt structure.

The Kangaroo-2 appraisal well is located in block S-M-1165, approximately 300 metres updip and 4 kilometres south from Kangaroo-1 and is the first well in the current Santos Basin exploration and appraisal drilling campaign. The information obtained from Kangaroo-2 will be crucial for assessing the commerciality of the Kangaroo oil field and will be the basis for the front-end engineering and design (FEED) phase bringing the project a step closer to commerciality.

Karoon holds a 65 per cent interest in, and is operator of the jointly held S-M-1165 block, Santos Basin.

The exploration and appraisal drilling campaign, operated by Karoon, is expected to continue through first half 2015.

The rig contract provides Karoon with two firm wells plus two option wells, and, in the event of a successful drilling in the first two wells provides maximum flexibility for further appraisal of the Kangaroo oil discovery, including testing and appraisal of the Kangaroo West prospect.

Following Kangaroo-2, the second firm well in the program is the Kangaroo West-1 exploration well. Due to the large size and proximity to Kangaroo, a successful outcome at Kangaroo West-1 would materially add to any possible development of the Kangaroo oil field.

The salt flank play was first proven by Kangaroo-1 with the intersection of a 76 metre gross oil column and oil recovered to surface from wireline DSTs. Results of the Kangaroo-2 further confirm the viability of the play. Kangaroo West-1 is located on the western flank of the same salt structure as Kangaroo-1 and has the same trap type and reservoir and seal intervals that have been mapped into the prospect from surrounding wells.

The Olinda Star semi-submersible drilling rig is drilling the entire drilling programme.

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