Sub-surface Evaluation and Resource Upgrade

RNS Number : 1111N

Borders & Southern Petroleum plc

14 May 2015

 

14 May 2015

Borders & Southern Petroleum plc

("Borders & Southern" or "the Company")

Sub-surface Evaluation and Resource Upgrade

Borders & Southern (AIM: BOR), a London based independent oil and gas exploration company, provides a technical update on its Darwin Gas Condensate Discovery and near-field prospectivity.

The Company has completed a comprehensive seismic reservoir characterisation study aimed at investigating the Early Cretaceous shallow marine play fairway. The objective was to improve the Company's understanding of the Darwin reservoir interval, both within and surrounding the discovery itself and its projected facies trend along the Aptian shelf. The analysis was based on approximately 2,500 square kilometres of high quality prestack depth migration (PSDM) 3D seismic data. Results from the study have allowed us to revise resource estimates for Darwin and close-by prospects.

The initial interpretation of the new 3D data confirmed the basic structural mapping but extended our knowledge northwards away from the discovery. The mapping also highlighted a number of interesting seismic amplitude anomalies, some of which were coincident with previously mapped leads. One of the key insights from this first phase of work was the influence of stratigraphic thinning of reservoirs on regional prospectivity. Potential reservoir intervals in the Early Cretaceous section, including the Darwin reservoir, thin towards the west and northwest. As a consequence, the shelf portfolio is now enhanced to include combined structural and stratigraphic traps.

The next phase of the evaluation comprised a seismic inversion study which utilised the excellent well-to-seismic calibration to help characterise the reservoir and further aid with prospect definition. The inverted seismic data describes the internal rock properties of the reservoir such as lithology type, porosity or fluid type rather than just the boundaries as mapped from conventional seismic reflection data. The processed data incorporates the well log data into a quantitative rock-property description of potential reservoir intervals. This study has identified new potential reservoir intervals and helped better define prospects and their resource assessments.

The results have highlighted a previously unrecognised reservoir interval extending over part of the Darwin East and Darwin West structures, just above the main reservoir. The interval is poorly developed in the discovery well but can be seen to expand to the east and south on the inverted seismic data. This porous interval is considered to be charged and to have a common contact with the main Darwin reservoir. Consequently, the Darwin resource assessment has now been revised to include this interval. Two lower intervals on Darwin West, previously identified and described but not included in to the resource assessment, have also been included. The revised best estimate (P50) un-risked estimate for the combined Darwin East and Darwin West structures, incorporating all proven and potential reservoirs, is 360 million barrels of recoverable condensate.

The main near-field prospects targeted by the seismic inversion study are: Covington, Morgan, Sulivan, Stokes and Wickham.

The principal target for Covington and Morgan is the main Darwin shallow marine sandstone reservoir. This north-northwest trending interval appears laterally continuous and, in the Company's view, represents a series of eastwards prograding sand bars on the Aptian shelf. Based on the seismic amplitude response we believe these prospects are more likely to be oil charged. Best estimate (P50) un-risked recoverable resource estimates for the Covington and Morgan prospects are 216 and 230 million barrels of oil respectively.

The target intervals for the Sulivan and Stokes prospects are older and deeper than the main proven Darwin reservoir. This older stratigraphy was not penetrated in the discovery well and some uncertainty remains as to the age and depositional environment of the potential reservoir. Based on the amplitude anomalies, the hydrocarbon phase is believed to more likely to be gas condensate, similar to Darwin. Best estimate (P50) un-risked resource estimates for Sulivan are 473 million barrels of recoverable condensate and for Stokes 134 million barrels of recoverable condensate.

The Wickham prospect has a target stratigraphically younger than the main Darwin reservoir. This shallow marine sand interval was not encountered in the discovery well. The prospect is located on the downthrown side of the main Darwin fault. Based on the amplitude response, this prospect is believed to be more likely oil charged. The best estimate (P50) un-risked recoverable resource is estimated at 119 million barrels.

Future sub-surface technical work will continue to refine the Company's assessment of this area but will also develop a greater understanding of the Early Cretaceous deep water channel and fan play which includes the previously described prospects Burgess and Bute.

A presentation containing more details about the status of the technical evaluation will be posted on the Company's website shortly.  

For further information please visit www.bordersandsouthern.com or contact:

Borders & Southern Petroleum plc Howard Obee, Chief Executive Tel: [phone] Panmure Gordon (UK) Limited

Dominic Morley/Adam James Tel: [phone]

Tavistock Communications Simon Hudson Tel: [phone]

Notes:

Borders & Southern Petroleum plc is an oil & gas exploration company listed on the London Stock Exchange AIM (BOR). The Company operates and has a 100% interest in three Production Licences in the South Falkland Basin covering an area of nearly 10,000 square kilometres. The Company has acquired 2,862 km of 2D seismic, 2,517 square kilometres of 3D seismic and drilled two exploration wells, making a gas condensate discovery with its first well. 

This statement has been reviewed, verified and approved by Dr Howard Obee in accordance with the Guidance Note for Mining, Oil and Gas Companies issued by the London Stock Exchange in respect of AIM companies. Dr Obee is a petroleum geologist with 30 years relevant experience, Fellow of the Geological Society and member of the American Association of Petroleum Geologists and the Petroleum Exploration Society of Great Britain.

This sub-surface analysis is based on Borders & Southern's in-house evaluation and reflects Management's probabilistic resource estimates.

Glossary

The above resource estimates have been estimated in accordance with the Petroleum Resource Management System guidelines endorsed by the Society of Petroleum Engineers.

3D	three dimensional
best estimate or P50	With respect to resource categorization, this is considered to be the best estimate of the quantity that will actually be recovered from the accumulation by the project. It is the most realistic assessment of recoverable quantities if only a single result were reported. If probabilistic methods are used, there should be at least a 50% probability (P50) that the quantities actually recovered will equal or exceed the best estimate.
condensate	a mixture of hydrocarbons that exist in the gaseous phase at original temperature and pressure of the reservoir, but when produced, are in the liquid phase at surface pressure and temperature conditions
recoverable resources	those quantities of hydrocarbons that are estimated to be producible from discovered or undiscovered accumulations
unrisked	without incorporating the probability of failure

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