Xstate Resources : Confirmation of Oil and Gas Discovery at Anshof-3
XST.AX
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14 January 2022
Announcement to ASX
Electronic lodgement
CONFIRMATION OF OIL AND GAS DISCOVERY AT ANSHOF-3
Wireline logging provides further confirmation of Anshof-3 hydrocarbon discovery:
Xstate Resources Limited (ASX: XST) ("Xstate", "XST" or "the Company") is pleased to inform its shareholders and the market of the results of the Anshof-3 exploration well.
Anshof-3
Anshof-3 Locaton Map
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Electric wireline logging results from the Anshof-3 exploration well has provided further confirmation of the discovery of oil at the primary Eocene target as well as a potentially productive shallow Miocene gas reservoir interval. The results, based on a quick-look petrophysical analysis are summarised as follows:
The well will be cased and cemented with 7 inch casing to the total depth utilising the RED Drilling & Services GmbH E-200 rig ("RED rig"). The RED rig will be demobilised, then the well will be completed and tested using a specialised, smaller and cost-effective workover rig.
The deeper Eocene oil target will be tested first to confirm reservoir productivity and continuity, then the shallower gas zones will be tested prior to placing the well on commercial production.
The Anshof-3 results to date confirm the existence of a large structure commensurate with predrill estimates, the existence of potentially productive oil filled Eocene sands, shallower Miocene gas sands interval as well as the existence of oil filled Cenomanian reservoirs, which are not likely to be productive at the Anshof-3 location but may be elsewhere on the structure.
The Operator, ADX Energy Limited (ASX:ADX), expects to declare a production license and initiate commercial production at Anshof-3 utilising proximal oil and gas infrastructure accessible under existing commercial arrangements.
While the Eocene net reservoir thickness at Anshof-3 location came in at the lower end of predrill expectations, thicker Eocene reservoirs are expected to the East of the structure based on offset wells which warrant further appraisal and development.
The Eocene reservoirs provide the most substantial reserves and value potential from the Anshof discovery while the shallow Miocene sands provide the opportunity to yield substantial additional near term cashflow from the Anshof-3 well given the very high gas prices around 30 US$/mscf currently being achieved in Europe.
Xstate Executive Chairman Mr Andrew Childs commented: "This is another great result for Xstate shareholders. Our continuing robust oil revenue from Canada has allowed the Company to successfully particate in a highly prospective exploration well. The wireline logging results indicate there are both oil and gas zones that are potentially productive. We look forward to testing and producing these zones over the coming months. Current strong oil prices and record high gas prices in Europe makes this opproptunity highly valuable."
Notes:
XST announced a farmin to ADX's Anshof-3 prospect to the ASX in a release dated 22 November 2021. XST funded 40% of the Anshof-3 well costs to earn a 20% participating interest in the Anshof Prospect. That farmin has now been completd, and XST partipates in the well going forward at 20% working interst.
An overview of the Anshof Prospect is included as Appendix 1 at the end of this release. It includes the results of an independent prospect review undertaken by RISC Advisory Pty Ltd (RISC).
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The Executive Chairman of Xstate, Mr Andrew Childs, is also a Non-Executive Director of ADX Energy. Mr Childs declared his conflict at the beginning on this process, and recused himself from all Board Meetings and decision making in relation to the Austrian opportunity.
This release was approved by the board of the Company
Andrew Childs
Executive Chairman
Xstate Resources Limited
Tel Office: +61 8 9435 3200
About Xstate Resources Limited:
Xstate Resources (ASX Code: XST) is an ASX listed company focused on the oil and gas sector. The Company has existing gas exploration assets located in the Sacramento Basin, California and associated gas production interests together with production interests in Alberta, Canada. Xstate is presently pursuing new opportunities in the oil and gas sector globally.
Competent Person:
The technical information provided has been supervised and reviewed in detail by XST's Competent Person, Mr Greg Channon, who is also a Non-Executive Director of the company. Mr Channon is a qualified geoscientist with over 35 years of oil and gas industry experience and a member of the American Association of Petroleum Geologists and the South East Asian Exploration Society and is a graduate of the Australian Institute of Company Directors. He is qualified as a competent person in accordance with ASX listing rule 5.41. Mr Channon consents to the inclusion of the information in this report in the form and context in which it appears.
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Appendix 1: Anshof Prospect Overview
Anshof is a well defined modern 3D seismic covered Eocene - Cenomanian prospect located up-dip and on trend from existing oil production from adjacent fields (Figure A1). The ADX in- house team has developed a new structural model constraining the nearby producing Voitsdorf, Bad Hall and Pfarrkirchen oil fields which has resulted in identification of a number of on trend prospects and appraisal opportunities. Success at Anshof-3 will validate the new structural model and de-risk multiple follow up prospects. Anshof-3 has a best technical case prospective resource potential of 6.6 MMBOE with significant upside potential in the primary Eocene sandstone reservoir objective. The well plan includes a deeper Cenomanian secondary target with a best technical resource potential of 2.1 MMBOE.
Original Resources Reporting Date: Upper Austria Exploration was on 30/11/2020, estimates were further revised on 30/3/21.
Figure A1: Anshof prospect Eocene depth map, seismic X section and schematic interpretation
(mentioned anti clockwise)
ADX commissioned RISC to provide an independent review of the prospectivity of the Austrian ADX-AT-I & II exploration licenses. RISC has reviewed the resources in accordance with the Society of Petroleum Engineers internationally recognised Petroleum Resources Management System 2018 (PRMS). RISC's methodology was to review the evaluation, probabilistic
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resource evaluation and geologic risking carried out by ADX. Details of the findings of their review were presented in a report. RISC have not conducted a site visit.
RISC has reviewed the Anshof Prospect and found the following Prospective Resource and Geological Risk assessment to be reasonable. A summary of RISC's findings for the Anshof prospect is shown in the Table 1 below. Refer also to ASX release 10 November 2021.
Table 1: Anshof Prospective Resource and Geological Risk Asssessment
(100% Equity Interest)
Unrisked Prospective
P(90)
2
(MMBOE)
P(50)
3
(MMBOE)
P(10)
4
(MMBOE)
Mean
5
(MMBOE)
6 Probability of
Resource 1
Success
Oil Case
0.50
3.30
16.20
6.60
43%
Notes to Table 1:
In RISC's opinion, the method of utilising a mapping based net-rock-volume (NRV) in the prospective resource assessment in the Anshof Prospect may result in a conservative volumetric assessment. RISC was not provided with an assessment of the deeper Cenomanian secondary objective for Anshof.
Access to Production Infrastructure
Figure A2: Aerial image prior to commencement of well site preparation showing the three Anshof surface locations and the distance to an existing oil and gas pipeline bundle that can be used to access oil and gas processing and export infrastructure
Approvals have been received from the regulatory authority for up to three drilling locations from the Anshof well site. The Anshof-3 Well location is approximately 50 metres from an oil and gas pipeline bundle which can be accessed to process and export crude.
On the 22nd of November 2020 ADX announced the agreement with RAG Exploration & Production GmbH (RAG E&P) of commercial terms for the access of future oil and gas production from ADX Upper Austria exploration and appraisal licenses in Upper Austria which
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Disclaimer
Xstate Resources Limited published this content on 13 January 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 13 January 2022 22:51:04 UTC.