Africa-Press – South-Africa. An exploration well drilled off the Northern Cape coast, which was hoped would prove the existence of a sizeable oil resource has come up dry, Eco Atlantic Oil and Gas has announced.
The oil and gas exploration company on Friday said that the Gazania-1 well on Block 2B, offshore South Africa, which spudded on 10 October, reached target depth of 2 360m but did not show evidence of commercial hydrocarbons. The well will now be plugged and abandoned as planned, Eco Atlantic said in a statement.
“While the well results are obviously disappointing at this location, we remain optimistic for this basin and look forward to continuing our exploration efforts”,” said Colin Kinley, chief operating officer of Eco Atlantic. “We very much appreciate the stakeholder and shareholder support on this well that was safely drilled with no environmental issues.”
CEO Gil Holzman said that while it is “naturally disappointing not having made a commercial discovery”, the Gazania-1 well was only the first of four wells the group has planned for the next 18 to 24 months across its wider portfolio.
The minimum $36 million (R623 million) exploration effort hoped to discover more than 300 million barrels of light oil and the Eco Atlantic share price has grown 34% in the past month as speculation about the drill results grew. Kinley on Friday said Gazania-1 faced early challenges with weather and service logistics which “cost us a bit of time to get started, however we are happy with the overall technical operation of the well”, he said.
The well logging is currently ongoing and Eco Atlantic and its joint venture partners will undertake a detailed analysis of the results, which will inform future plans.
Kinley said gases normally associated with light oil were encountered throughout the drilling of the Gazania-1 well. “This, in our view, confirms the active hydrocarbon system, proven by the A-J1 discovery well [drilled by Soeker in 1988], extends to the part of the basin where the Gazania-1 well is located. Further seismic interpretation will likely lead to the definition of viable areas for trapping downdip of Gazania-1 closer to the 1988 oil discovery A-J1,” he said.
Eco Atlantic said it had submitted an application for a production right to the Petroleum Agency of South Africa for Block 2B, based on the 1988 oil discovery and potential future operations.
The company and its respective JV Partners will now move on to executing plans for more exploration wells, including a two-well campaign on Block 3B/4B offshore South Africa planned to begin in 2023.
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