The British Oil company prospecting for oil in the Ogaden basin, New Age, has noted oil and gas flow in its appraisal well Elkuran-3. New Age started drilling the appraisal well last October, with a targeted depth of 2,850 meters.
Reliable sources told The Reporter that a crew was drilling the well when it noted oil and gas flow at a depth of 1200 meters on February 12, 2014.
"Oil and gas shows were noted throughout the intervals," the source said. The results are similar to that of Tenneco, the American company that drilled the first exploration well in the Elkuran locality in the 1970s. "Tenneco's drilling crew encountered similar results in 1972," the source said.
A petroleum expert told The Reporter that oil and gas flow does not necessarily mean that there is a commercial deposit. "Oil and gas flows are very common in that region, especially in the Elkuran and Hilala localities. More exploration work is needed," the expert said.
Sources said the reservoirs at Elkuran-3 have low porosity and permeability and will likely require acid or fracture stimulation to produce the necessary commercial levels.
"Oil and gas-condensate was recovered from one of sample zones. At the base of the well, a flow of gas was encountered and the drilling is suspended in order to mobilize test equipment to evaluate this zone. A decision has also been taken to deepen the well to below the initial planned target depth of 2,300m, to evaluate the deeper sandstone zone which is considered to have a significant gas condensate potential," the source said.
New Age (African Global Energy) Limited works in the Ogaden basin Block 7, 8 and the Adigala concessions with its partner, Africa Oil, the Canadian oil firm. New Age engages in the exploration, development, and production of oil and gas, primarily in the African region. The company holds licenses for 13 onshore and offshore blocks in Congo-Brazzaville, Ethiopia, South Africa, and Kurdistan, covering an area of approximately 88,000 sq.km.
According to the company's official website, it has a portfolio of development, appraisal, and exploration assets, with 37.5 million barrels of oil equivalent of gross probable reserves, 17.1 million barrels of oil equivalent of gross contingent resources, and 702.2 million barrels of oil equivalent of gross prospective resources. New Age (African Global Energy) Limited was founded in 2007 and is based in London.