Valeura Announces Rig Release From Yamalik-1 Well and Positive Evaluation Results
Wednesday 26 July 2017
Valeura Energy Inc. ("Valeura" or the "Corporation") (TSX: VLE) is pleased to announce that the first deep exploration well, Yamalik-1, under Phase 1 of the Banarli farm-in agreement (the "Banarli Farm-in") with its partner Statoil Banarli Turkey B.V. ("Statoil"), has completed drilling and the drill rig has been released. The well was drilled to a total depth of 4,196 metres and has been cased and left in a state ready for completion and production testing. The estimated well cost at rig release is within budget. Under the Banarli Farm-in, Statoil is funding the drilling of Yamalik-1 on a 100% basis up to a cap of 110% of the budgeted cost.
Yamalik-1 was designed as the Corporation's first test of the deep, basin-centred gas potential in the Thrace Basin of northwest Turkey. The key objectives of this well were to prove the presence of reservoir rock, confirm that the encountered reservoirs are over-pressured, and to demonstrate that there are significant sections of the reservoirs which are gas-saturated. Encouraging gas shows were encountered while drilling the objective section and, based on the drilling data, the well is over-pressured below approximately 2,900 metres down to the total drilled depth of 4,196 metres. Interpretation of the extensive wireline logging data acquired in the objective section indicates the well has exceeded the criteria to proceed further with the completion and to test potential zones with hydraulic stimulation. As the Yamalik-1 well was drilled in an area with no structural closure, the over-pressures and the indicated pervasive gas saturation in the well are positive indicators of the potential for a basin-centred gas play in the Thrace Basin.
Valeura is currently working with Statoil to design the completion, multi-stage fracing and testing program. Further analysis of the Yamalik-1 well logs and 130 metres of new core data is in progress in order to finalize the design and cost estimate for the completion and testing. It is expected that the completion and testing program will commence late in the third quarter of 2017. Under the Banarli Farm-in, Statoil will pay 100% of the completion and testing program up to a cap of 110% of the agreed budget. Commerciality of the Yamalik-1 well will be determined after the completion and testing program.
After the testing of Yamalik-1 is complete, the Corporation anticipates having improved data to assess the extent of the resources in the tested formations. The Corporation will then work with its partner Statoil to determine potential future work programs for continued delineation of the basin-centered gas play.
In further advancement of the Banarli Farm-in, Statoil is proceeding with Phase 2 of the farm-in agreement, which comprises the acquisition of 3D seismic across the Banarli Farm-in lands and parts of the West Thrace lands not currently covered with 3D seismic. Shooting of the seismic has already commenced, with more than 76 square kilometres recorded to date out of a planned scope of approximately 500 square kilometres. The survey is expected to be completed by early in the fourth quarter of 2017 with Statoil funding 100% of the agreed budget of US$10 million.