OREANDA-NEWS. Oryx Petroleum Corporation Limited (Oryx Petroleum) announces an update on its drilling activities at Banan and Demir Dagh in the Hawler license area in the Kurdistan Region of Iraq. Oryx Petroleum is the operator and has a 65% participating and working interest in the Hawler license area.

Commenting, Henry Legarre, Oryx Petroleum’s Chief Operating Officer, stated:
"Our exploration and appraisal activities in the Hawler license area continue to progress. We have completed drilling the Banan exploration well targeting one of the largest prospects in our portfolio. Hydrocarbons were encountered in the Cretaceous, Upper and Lower Jurassic and Triassic and we are now commencing a testing program. We have successfully re-completed the Demir Dagh-2 well and we are making excellent progress with the Demir Dagh-3 and Demir Dagh-4 appraisal wells. Observations during drilling of all wells on the Demir Dagh structure continue to be encouraging."

Banan Exploration Well
As previously reported, the KS Discoverer 1 rig spudded the BAN-1 well, the Corporation’s fourth exploration well in the Hawler license area, targeting the Banan prospect, in mid-September. The BAN-1 well is targeting oil potential in the Cretaceous, Upper and Lower Jurassic and the Triassic. Netherland, Sewell & Associates, Inc. (NSAI) estimates as of March 31, 2013 were that the Banan prospect contains 196 MMbbl of best estimate unrisked gross (100%) prospective oil resources (risked: 102 MMbbl). NSAI’s estimate excludes a significant portion of the Banan prospect that was outside the Hawler license area boundaries prior to the boundary extension agreed to with the KRG in December 2012. See “Reserves and Resources Advisory” below for additional information regarding this estimate. Recently acquired 2D seismic data over the extension area has confirmed that the likely crest of the Banan structure is significantly up-dip of the BAN-1 well.

The BAN-1 well was planned to be drilled to a total depth of 4,153 metres in the Kurra Chine formation. The well experienced a significant pressure kick while drilling at approximately 4,000 metres in a fractured section of the Kurra Chine. During the following well control operation, light oil from the Kurra Chine formation was burned at the flare.. As the well had not been designed for conditions encountered in the Triassic, the well was plugged back to 3,400 metres in preparation for testing operations in the shallower Cretaceous and Jurassic formations. A future appraisal well with modified well design, if pursued, should enable evaluation of the Kurra Chine formation in the Banan structure.

As previously reported, logging data, core analysis and observations during drilling in the Upper Cretaceous (Shiranish, Kometan and Upper Qamchuqa formations) confirmed the presence of hydrocarbons and similar reservoir properties, including matrix porosity, as observed at Demir Dagh. Logging data and observations during drilling, including free oil on the shakers and cuttings, also confirm the presence of hydrocarbons in the Upper Jurassic (Najmah formation) and Lower Jurassic (Mus & Base Alan, Adaiyah, and Butmah formations). Losses of drilling fluids also indicated existence of a permeable fracture network. These are encouraging indications, however, no conclusions with regards to recoverability or commerciality of any hydrocarbons can be reached until the testing program is conducted.

Oryx Petroleum’s testing program for BAN-1 consists of five firm cased-hole drill stem tests (DSTs) and one contingent cased-hole DST. It is expected that the testing program will conclude in March 2014. Should the testing be successful, the Corporation is considering accelerating plans to drill an appraisal well on the crest of the Banan structure.