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Wednesday, March 4, 2020
The BMK-1 well in Morocco has been drilled to a measured depth of 1,551 meters and has encountered commercial quantities of gas in both target horizons, according to SEX Energy. The Upper Guebbas was encountered at a measured depth of 1,190 meters, while the Lower Guebbas was penetrated at a measured depth of 1,475 meters.
Following the OYF-2 discovery which was announced on 28 January 2020 and successfully tested last week, and this BMK-1 discovery, the company can confirm that the prospectivity in its existing core production and development area extends to the north. As a result, management estimates that, based upon these well results and the existing 3D seismic over the area, the Company has opened a new play fairway and de-risked up to 20bcf of P50 close-by prospective resources for future drilling of which approximately 10 Bcf is located in and around BMK-1. See below a link to a map of the area.
Using Measurement While Drilling (MWD) tools, management estimates that BMK-1 encountered a total of approximately 0.9 Bcf of gas in the Upper and Lower Guebbas targets, in line with pre-drill estimates. However, due to down-hole issues, only the Upper target was wireline logged and will be completed. Management estimates that the Upper target has approximately 0.4 Bcf of recoverable gas and that the gas in the Lower target will be recoverable during the development of the new play fairway de-risked by the OYF-2 and BMK-1 wells.
The rig will now move to the Lalla Mimouna concession to drill the potentially play-opening LMS-2 well. With the drilling of this tenth well, the company will have fulfilled the three objectives of the campaign which were; (i) to add reserves in and around its existing infrastructure; (ii) to determine if its existing producing area extends to the north; and (iii) to test the prospectivity within the Lalla Mimouna concession. Furthermore, given that the last two planned wells would not have been immediately tied into the Company’s infrastructure or contributed cash flows in the near term, the company has decided to preserve its capital and postpone these last two wells, at no incremental cost, for a future campaign. Given all of this, the campaign will conclude after LMS-2.
Mark Reid, CEO of SDX, commented: “The BMK-1 result in Morocco is excellent news, confirming that together with the OYF-2 discovery in January, we can now plan to develop a material and valuable new prospective area to the north of our existing infrastructure in a market where we are the only gas producer and where we receive gas prices of between $10-12 per mmcf. An additional 20 bcf of P50 prospective resources has the potential to significantly extend reserve life and support lower CO2 emissions at our customers.”
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