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Norwest Energy Testing To Unlock Potential Of Arrowsmith-2

Norwest Energy (ASX: NWE) has started planning and preparation to re-enter its Arrowsmith-2 unconventional well in the onshore Perth Basin to obtain measurable flow rates from each of the five zones that were fracture stimulated.

Results from this will be used by independent consultants to assess the initial estimated contingent resources for each zone and will determine the way forward for Norwest.

"Arrowsmith was a proof of concept well and has performed way beyond our expectations, especially being capped off with oil from the Kockatea. There was an expectation that we might get some condensate, but oil is a real bonus," managing director Peter Munachen said.

He noted that while the re-entry, testing and assessment would take time, Norwest had the expectation for potential multiple trillion cubic feet of gas.

Besides the re-entry, Norwest is also addressing the renewal of the EP 413 permit from 1 May 2013.

While this cannot be finalised until results are known from each interval, future work is likely to include 3D seismic to more accurately map the High Cliff Sandstone closure and the base of the Kockatea Shale as well as help with the planning of future horizontal wells.

Re-entry work program

The work program will start with the flow back of the Kockatea Shale interval, the shallowest of the five zones, to allow indicative rates of gas and oil to be measured.

Once cleaned up and the evaluation completed, cement will be squeezed into the Kockatea perforations to seal off this interval. Coiled tubing will then be used to mill out the plug between the Kockatea Shale and the Carynginia Formation. This will enable flow back and clean up to recommence on the Carynginia Formation interval.

Oil from the Kockatea is waxy with estimated gravity of 37 degrees API. Analysis has narrowed down the source of oil to either shale oil production from the shale or a potential source at the base of the Kockatea in the Hovea-Wagina Formation.

Norwest had being required to temporarily shut-in the well while suitable surface containment equipment and the necessary Department and Mines and Petroleum approvals were arranged to manage the handling of oil to surface.

The Kockatea flow will be followed by testing of the Lower and Middle Carynginia Formations.

While a gas rate was not confirmed initially due to limited flow back time, it remains a highly prospective shale gas target with gas production to surface, good total organic content values and other important positive indicators.

In addition, the rock contains a high volume of quartz that increase the brittleness index of the rock, thus increasing the ability of hydraulic fracture stimulation to create a complex fracture network.

Next up will be the Irwin River Coal Measures, which will be re-entered after the Carynginia.

Flow from this interval will be co-mingled with Carynginia flow back, and estimates made of its contribution based on previous results from the Carynginia flow back.

While this interval was slower to deliver gas compared to the other zones, this is believed to be a product of the flow back strategy used on this zone rather than an indication of its ability to produce gas.

Last, but not least is the extended well test on the High Cliff Sandstone, which had flowed gas at a maximum rate of 777,000 cubic feet of gas per day during flow back.

Again, flows will be co-mingled with both IRCM and Carynginia flow back.

Should the zone have sufficient area extent, Norwest has the option to convert this well to a producing well.

Partners in EP 413 are operator Norwest with 27.945%, AWE Limited (ASX: AWE) with 44.252% and India's Bharat PetroResources (27.803%).

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