LO 16/20

 

Licence LO 16/20
Europa interest 100% operator
Partners -
Area km2 945
Basin Slyne
Play Triassic sandstone (gas)
Term 2 year Licensing Option

We consider the Inishkea prospects in LO 16/20 in the Slyne basin and near the Corrib gas field our flagship project in Ireland. We are seeking to fast track technical work on Inishkea with the intention of delivering a new prospect inventory in H1 2019 and, subject to meeting technical and commercial criteria, identifying a firm drilling target for an exploration well in 2020.

The Triassic gas hydrocarbon play is well understood and proven to work both technically and commercially in the Slyne basin by the Corrib gas field. Therefore, play risk is lower than in other Atlantic Ireland basins where play risk remains to be conclusively proven by a commercially successful exploration discovery.

We believe 2.5 tcf of undiscovered Gas Initially In Place (GIIP) is likely to translate into commercially significant prospective resources. We understand that the recovery factor at the Corrib field is ~ 80%.

Water depths are comparatively shallow (400-600m) and do not require harsh environment sixth generation drillships therefore drill costs are lower. We have recently conducted a drill cost estimate for a well on the Inishkea prospect and dry hole cost including mob and demob is US$28 million using a prevailing rig rate of US$120,000 per day.

Gas infrastructure is already present nearby at Corrib therefore a fast track path to commercialisation is potentially available, subject to negotiation and cooperation with the infrastructure owners

Gas is likely to be a significant component of Ireland’s future energy needs both for electricity generation and domestic and industrial heating.

We have identified 2.5 tcf undiscovered GIIP in 6 prospects and leads on LO 16/20 and in the Triassic gas hydrocarbon play (see table below). The Triassic gas play comprises Triassic Sherwood sandstone reservoir, Carboniferous source rocks, Triassic Mercia mudstone seal and structural traps. The Foyle prospect complex has been renamed Inishkea after islands off the Mullet peninsula in County Mayo.

Table shows best technical estimate undiscovered GIIP

Prospect bcf
Corrib North discovery 40
Inishkea prospect 1,098
Inishkea NW prospect 1,094
Inishkea W prospect 212
Corrib NW prospect 26
Bofin lead 69
Total 2,539

 

These six prospects have been mapped by Europa on legacy 3D seismic data originally acquired in 2002 which we purchased from the Irish government.  These existing time domain data require further processing to the depth domain. This will significantly improve the definition of the complex geology of the area. We have started this work with DownUnder GeoSolutions (DUG) to reprocess the 3D seismic data through a Pre-Stack Depth Migration process.  The additional clarity this will provide should enable some of the prospects to be upgraded to drillable status during H1 2019.  These data are now being loaded at DUG with the same processing team that has been working with us to great effect for over a year on two South Porcupine 3D reprocessing projects. We are confident they will deliver yet another high quality product for the Slyne Trough.

More legacy 3D seismic data over the Corrib field will become available in the public domain in May and December 2018. The new data are ocean bottom cable (OBC) 3D seismic data acquired in 2012 and 2013. We understand that it provides much improved definition of the Corrib field and also extends over the Corrib North gas discovery, which lies within LO 16/20. A combination of the OBC 3D over Corrib together with PSDM reprocessed 3D over our prospects should enable better quality maps to be produced and better geotechnical insight, which will enable better definition of geological risk and prospective resources.

We are working with OPC a specialist subsurface and production engineering group on porosity and permeability modelling, development scenarios and costs. We believe that the Inishkea prospect complex has been less deeply buried than the Corrib field, suggesting that Inishkea poroperm and therefore recovery factors should be at least as good as Corrib. We are also evaluating the 18/20-7 gas discovery well on the Corrib North prospect. Whilst poroperm at Corrib North is towards the tighter end of the spectrum and the GIIP is comparatively low we believe it is possible that it could nevertheless represent a commercially viable reserve. The outcome of this work will inform our commercial and economic assessment and will be used together with the new PSDM mapping to make a prospect selection and drill decision during Q1 2019.

The Corrib field was discovered by Enterprise Oil in 1996. Europa has access to a number of former Enterprise staff responsible for this project including: the geophysicist who first mapped the Corrib prospect, the Dublin exploration manager responsible for the first four exploration and appraisal wells and the Dublin general manager responsible for taking the field through to consent for plan of development. Europa therefore has significant and relevant technical, commercial and project management expertise to apply to gas exploration in LO 16/20.