Argentine based GeoPark Holdings (LON:GPK) has reported the successful testing of two new wells on the Fell Block in southern Chile.
The Aonikenk Sur 1 is a new pool gas discovery and Alakaluf 7 a new oil producer, according to the company’s report. The Aonikenk Sur 1 well was drilled and completed to a total depth of 2,348 metres.
A production test in the Springhill formation, at approximately 2,266 metres in a 4.5 metre perforated interval, flowed at a rate of approximately 11.3 million cubic feet per day (MMCF/D) (or 330,000 cubic metres per day) of gas with 207 barrels per day (bpd) condensate and no water through a choke of 16 millimetres and with a well head pressure of 1,556 pounds per square inch.
The Alakaluf 7 well was drilled and completed to a total depth of 2,270 metres. A production test in the Springhill formation, at approximately 2,220 metres in a 12.5 metre perforated interval, flowed at a rate of approximately 1,006 bpd of oil with no water through a choke of 14 mm and with a well head pressure of 290 pounds per square inch.
“The dedication of our professionals’ team that have successfully combined knowledge and technology has allowed us to achieve these very good results in this exploration year, which encourages us to continue exploring and expanding in Chile”, said GeoPark (LON:GPK) president James F. Park. The company has an investment plan totalling 60 million US dollars which should help finance 14 to 16 on shore wells.
“New 3D seismic surveying in the Fell area will increase our prospects and the possibility of new drillings,” added Park. He also revealed that further 2D and 3D surveying is underway in the Tranquilo and Otway blocks, in the extreme south of Chile. “We should be drilling there before the end of the year”, said Park.
Chile has encouraged oil and gas exploration in the Magallanes region, extreme south of the country, including Tierra del Fuego, where oil was first discovered in the country six decades ago.
A huge Canadian Methanex Corporation (TSE:MX) complex for the production of methane launched over a decade ago when Argentina natural was abundant has seen its activities seriously limited because the Argentine government policy is to privilege domestic demand in spite of international contracts.
As a consequence the plant, possibly the largest private industry investment in Punta Arenas area has been forced to decrease production and the Chilean government is thus strongly promoting natural gas development in the region.