Caspian Sunrise makes progress at deep wells as it finalises 3A purchase

The AIM-traded firm said that, having identified potential oil bearing intervals covering in aggregate 121 meters so far during the drilling of the side-track, it had decided to stop the side-track at a depth of 4,851 meters and, after running and cementing a five-inch liner to the full depth of the side-track, to test the well.

It said four potentially oil bearing intervals had been identified during drilling, and supported by mud log data.

The first was of six meters between 4,535 and 4,541 meters; the second was of 20 meters between 4,554 and 4,694 meters; the third was of 59 metres between 4,635 and 4,694 metres, and the fourth was of 36 meters between 4,812 and 4,848 meters.

“The pressure in Well 801 remains high indicating good connectivity,” the board said.

“As the side-track has been drilled using lower density drilling mud we expect the task of getting the well to flow to allow testing to commence should be easier than previously drilled deep wells.”

At Deep Well A5, Caspian said work was continuing to prepare the mobilised rig to remove the pipe from the well, and thereby clear the obstruction which resulted in a suspension of the 90-day flow test towards the end of 2017.

It said it expected to commence operations in the near future once the drilling mud in use at Deep Well 801 became available.

“Pressure in the well remains high at 400 bar at the wellhead, which suggests there is still good communication throughout the length of the well,” the board explained.

The company said its plan with Deep Well A6 remained to re-perforate the well using more powerful explosive charges.

It said the drill pipes to be used in that operation were currently in use at Deep Well 801, and work at Deep Well A6 would not commence until the pipes at Deep Well 801 were released.

“The identification of, in aggregate, 121 meters of potential oil bearing intervals in drilling the 801 side-track allows us to move to the test phase sooner than was expected,” said chairman Clive Carver.

“The lower density drilling mud used on this side-track should make bringing the well into test production an easier proposition than with our earlier deep wells where far denser drilling mud was the principal issue.”

Additionally, and further to the company’s announcement on 31 January, Caspian Sunrise confirmed that the sale and purchase agreement for the conditional acquisition of 100% of the shares of 3A Best Group for a consideration of $24m - to be satisfied by the issue of 149,253,732 shares at an issue price of 12p per share - had been formally entered into.

Completion of the acquisition was now dependent on the satisfaction of a number of post-signing conditions, including the issuance of a new licence.