Eaglewood's Stanley field connection

THE petroleum development licence to advance Horizon Oil and Talisman Energy’s Stanley field condensate recovery project in PNG’s Western Province is on hold after recent seismic and well data confirms an Eaglewood Energy licence hosts part of the Stanley field.
Eaglewood's Stanley field connection Eaglewood's Stanley field connection Eaglewood's Stanley field connection Eaglewood's Stanley field connection Eaglewood's Stanley field connection

The Toronto-listed explorer owns 65% of PPL 259 which is next door to the Horizon-led petroleum retention licence 4 where the Stanley field was discovered.

Eaglewood previously sold a 25% stake of PPL 259 to Horizon for $US2.5 million earlier this year.

But the perceived value of the licence was already higher after that transaction, with Eaglewood striking a deal with Mega Fortune International to sell a separate 25% stake for $15.4 million.

While the deal ended up falling through, Eaglewood recently revealed that reserves evaluator Gaffney, Cline & Associates found an encroachment of the Stanley field into PPL 259.

The research was based on 2D dip seismic lines over the western portion of the field Eaglewood acquired in August, along with a data review of the Stanley wells in PRL 4.

After receiving the GCA study, the Department of Petroleum and Energy told Eaglewood that Horizon had lodged for a PDL for the PRL 4 area.

The PDL is for the Stanley field condensate recovery project Horizon is developing with long-time joint venture partner Talisman, which is on track for first production in late 2013.

But the evidence that the field area is larger has led the department to put any PDL plans on ice for the time being.

"This correspondence further advised that this PDL application will not be processed by the DPE until such time as the unitisation issue with the PPL 259 joint venture has been satisfactorily resolved," Eaglewood said.

"The corporation [Eaglewood] has provided the PRL 4 joint venture with the GCA study and now awaits receipt of equivalent studies from the PRL 4 joint venture.

"This data will allow the corporation to develop a complete picture of the Stanley field, including resource volumes and classifications as well as the resultant equity position held by the PPL 259 joint venture."

Unsurprisingly, Eaglewood chief executive officer Brad Hurtubise said he was pleased with the support received from the PNG government.

"Given that both Talisman and Horizon have publicly announced Stanley final investment decisions and the PRL 4 joint venture has already applied for a PDL, we hope to finalise unitisation in a timely manner and look forward to formalising our equity participation in the Stanley field," he said.

Horizon owns 50% of PRL 4, Talisman owns 40% and Mitsubishi owns 10%.

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