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MEO Australa: Seismic Data Increasing Value Of Portfolio

MEO Australia's (ASX: MEO) focus on acquiring quality seismic data is poised to upgrade the value of its portfolio of petroleum assets, including a potential connection between its prospects and a major gas field in the Carnarvon Basin, offshore Western Australia.

Initial evaluation of the Foxhound multi-client 3D survey over WA-360-P the company had purchased in May supports a postulated connection of the Jurassic reservoirs forecast at the Maxwell prospect to the Triassic reservoirs of Chevron's (NYSE: CVX) Wheatstone gas field, which holds 4.5 trillion cubic feet of gas.

This postulated connection extends north from Wheatstone through the adjacent permit and continues to Maxwell.

MEO is now working on full depth correction of the seismic data. This will be combined with the results of the Ananke-1 well that Woodside Petroleum (ASX: WPL) is drilling inWA-269-P to possibly advance the Maxwell prospect to drillable status.

"MEO has made a substantial investment in high quality seismic acquisition and processing in most of our project areas in the last year," MEO managing director J├╝rgen Hendrich said.

"We are very encouraged by the preliminary interpretation that reinforces the exploration concepts and strategies we have for these high potential opportunities.

"It is apparent that the acquisition of seismic data will result in a significant upgrading of the value of MEO's portfolio. We look forward to completing this process ahead of realising the value of these opportunities."

Breakwater and Marina

MEO's prospective Marina and Breakwater structures in WA-454-P have been confirmed by preliminary evaluation of the Floyd 3D seismic that was completed this year.

The final processed data will be available in September where it will play a key role in the farm-out process that is expected to be launched in the fourth quarter of this year by reducing uncertainty and risk for both opportunities.

Marina is estimated to hold best (2C) contingent resources of 6.5 million barrels (MMbbl) of oil and 98 billion cubic feet (Bcf) of gas while the undrilled Breakwater prospect could hold 2C contingent oil resources of 52MMbbl if oil is present along with 636Bcf of gas.

An oil discovery at Breakwater would make for a fairly easy decision to commercialise while the gas can be easily tied into Eni's producing Blacktip gas field to the southeast.

Timor Sea (Ashmore Cartier region)

Over in AC/P50 and AC/P51, preliminary evaluation of the Zeppelin 3D seismic data has confirmed promising leads in the gaps between the existing 2D seismic and in areas that were not resolvable on the Onnia 3D seismic that was shot in 1998.

While mapping is still underway, the data has already revealed a three-way dip closed structural lead with up to 300 metres of interpreted vertical closure with evaluation of direct hydrocarbon indicators illustrated in the seismic section being carried out.

The final processed data is expected in September. This will allow more accurate resolution and mapping of the leads and possible advancement to drillable status.

Seruway production sharing contract

MEO expects to receive the final Ibu Horst 3D data over the Seruway PSC in North Sumatra in August though fast track data received to date has already allowed it to identify a number of appraisal as well as exploration targets.

Strong amplitude anomalies in the shallow section are evident and thought to indicate the presence of gas. Deeper structures with carbonate build-ups are also present.

Delivery of the final processed volume will enable MEO to develop a comprehensive prospects and leads inventory.

Comment

While the interpretation of the seismic data is still in its preliminary stages, it has already served to reduce uncertainty over existing prospects and allowed MEO to identify new targets.

Importantly, it positions the company to proceed with its planned farm-outs in the coming months.

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