Woodside Petroleum has made a gas discovery in a new area of the prolific Carnarvon Basin off northwestern Australia, where it has been looking for resources to underpin the expansion of its Pluto LNG project.
The Alaric-1 exploration well in Woodside's wholly owned WA-434-P permit intersected about 185 meters of gross gas over several zones, the company said
in a statement Monday. The well is currently being deepened to ensure the full
gas column is penetrated.
"Initial analysis of drilling fluids suggests the gas could be comparatively liquids rich, but this requires confirmation by further analysis," Woodside said.
Subsequent to drilling, wireline logging will be conducted to recover gas samples and the well will be plugged and abandoned as planned.
"The Alaric-1 well is located in Woodside's Claudius hub and significantly extends the area of the known gas province in the Greater Carnarvon Basin," the company added.
Woodside's shares bounced following news of the discovery, closing the day 3.8% higher at A$43.10 ($38.56). The market took the announcement as a positive sign that the company could have enough gas of its own to support second and third LNG production trains at the Pluto project, where the first-phase 4.3 million mt/year plant is currently nearing completion.
Woodside is expected to update the market about progress on the Pluto expansion when it announces its half-year results on Wednesday. The company has previously targeted a final investment decision on the expansion by the end of this year.
At the end of June, Woodside's Pluto foundation project was 91% complete and on track to deliver first LNG in early 2011. The A$12 billion project is owned 90% by Woodside and 5% each by its Japanese LNG customers Tokyo Gas and Kansai Electric.
Woodside has been exploring its WA-404-P permit, where it is expected to complete a nine-well commitment by the end of 2010, for gas to feed Pluto phase two. The company has so far made two discoveries -- Martell-1 and Noblige-1 -- from four wells drilled in the permit, held in a 50:50 joint venture with US independent Hess Corporation.
Woodside has also been in talks to secure gas held in the region by other companies, including Hess and BHP Billiton, which owns the undeveloped Scarborough field with ExxonMobil. Hess executives told analysts after announcing the company's second-quarter results late last month that the gas
at the Martell and Noblige discoveries was slated to go to Pluto two.
But Hess has no plans to decide until some time in 2011 how it would commercialize the gas it has found in its wholly owned WA-390-P permit, the
analysts were told. Hess has so far drilled 14 of 16 commitment wells on WA-390-P, resulting in 11 gas discoveries.
The remaining two commitment wells are to be drilled during the third quarter this year, with appraisal work to be completed in the first quarter of 2011. Meanwhile, commercial discussions with potential partners, including Woodside, Chevron and Shell, for the development of the discovered gas are ongoing, Hess said.
Chevron is currently looking for gas for a "multi-user" LNG hub to be based around its planned Wheatstone foundation project near Onslow in Western Australia. Shell meanwhile is developing its floating LNG technology for deployment off northwestern Australia, initially at its Prelude field.
The Alaric-1 exploration well in Woodside's wholly owned WA-434-P permit intersected about 185 meters of gross gas over several zones, the company said
in a statement Monday. The well is currently being deepened to ensure the full
gas column is penetrated.
"Initial analysis of drilling fluids suggests the gas could be comparatively liquids rich, but this requires confirmation by further analysis," Woodside said.
Subsequent to drilling, wireline logging will be conducted to recover gas samples and the well will be plugged and abandoned as planned.
"The Alaric-1 well is located in Woodside's Claudius hub and significantly extends the area of the known gas province in the Greater Carnarvon Basin," the company added.
Woodside's shares bounced following news of the discovery, closing the day 3.8% higher at A$43.10 ($38.56). The market took the announcement as a positive sign that the company could have enough gas of its own to support second and third LNG production trains at the Pluto project, where the first-phase 4.3 million mt/year plant is currently nearing completion.
Woodside is expected to update the market about progress on the Pluto expansion when it announces its half-year results on Wednesday. The company has previously targeted a final investment decision on the expansion by the end of this year.
At the end of June, Woodside's Pluto foundation project was 91% complete and on track to deliver first LNG in early 2011. The A$12 billion project is owned 90% by Woodside and 5% each by its Japanese LNG customers Tokyo Gas and Kansai Electric.
Woodside has been exploring its WA-404-P permit, where it is expected to complete a nine-well commitment by the end of 2010, for gas to feed Pluto phase two. The company has so far made two discoveries -- Martell-1 and Noblige-1 -- from four wells drilled in the permit, held in a 50:50 joint venture with US independent Hess Corporation.
Woodside has also been in talks to secure gas held in the region by other companies, including Hess and BHP Billiton, which owns the undeveloped Scarborough field with ExxonMobil. Hess executives told analysts after announcing the company's second-quarter results late last month that the gas
at the Martell and Noblige discoveries was slated to go to Pluto two.
But Hess has no plans to decide until some time in 2011 how it would commercialize the gas it has found in its wholly owned WA-390-P permit, the
analysts were told. Hess has so far drilled 14 of 16 commitment wells on WA-390-P, resulting in 11 gas discoveries.
The remaining two commitment wells are to be drilled during the third quarter this year, with appraisal work to be completed in the first quarter of 2011. Meanwhile, commercial discussions with potential partners, including Woodside, Chevron and Shell, for the development of the discovered gas are ongoing, Hess said.
Chevron is currently looking for gas for a "multi-user" LNG hub to be based around its planned Wheatstone foundation project near Onslow in Western Australia. Shell meanwhile is developing its floating LNG technology for deployment off northwestern Australia, initially at its Prelude field.
