Coring activity has begun on LG-1 Up-dip appraisal well: ‘So many key risk factors removed,’ says CEO
Any gamble in life is based on risk versus reward.
Richard Wadsworth believes Sonoro Energy’s Budong Budong lease in Indonesia represents a very rare combination of the two.
“We’ve got an opportunity in Indonesia, in Sulawesi, where we’re in a new basin. It’s been drilled through. There’s an anticlinal structure. There’s bypassed oil and gas shows. And all of those things remove a lot of the risk,” Mr. Wadsworth, Chief Executive Officer and Director of Sonoro Energy (TSX-V: SNV), told Gecko Research in an interview in recent days.
“That’s really what attracted our team, and myself, to this specific opportunity. It’s got so much upside, but we think that the risk is somewhat lower than your traditional exploration-type project,” added Mr. Wadsworth.
In a Locking Horns video with 8020Connect, Mr. Wadsworth also commented: “We’re really coming back to what was previously a success, and is known to have oil and gas . . . what we’re doing is going back in (to the LG-1 structure) to prove its productivity.”
Coring drilling operations have now begun on Sonoro’s LG-1 Up-dip well on the Budong Budong Production Sharing Contract (PSC) in the Indonesian province of West Sulawesi, where crews with Sonoro’s drilling contractor PT Advanced Services Indonesia encountered a gas kick and oil shows in the cuttings and mud to surface from a depth of 297 meters.
“It’s not every day that you get to go and drill an exploration (well)—closer to an appraisal well—that has so many key risk factors removed,” says Mr. Wadsworth. “We’re the only license on West Sulawesi at the moment, and we’ve got 1,000 square kilometers.”
The Budong Budong PAC has a potential unrisked 15.9 million barrels-of-oil equivalent (boe) potential resource, according to an independent estimate. This number is based on only the LG-1 structure, and does not represent the other 13 identified prospects—some of which are significantly larger.
Late last week, Mr. Wadsworth conducted interviews with both Gecko Research and 8020 Connect, where he discussed topics such as:
- The paradigm shift that Sonoro is creating in Indonesia with the LG-1 appraisal well, using a smaller, more cost-effective hydraulic coring drilling rig for shallow targets;
- Additional coring and testing information to assess the reservoir;
- Government relations in Indonesia (“we’re getting a lot of attention from them . . . they’re very keen to see us succeed”); and
- Next steps, assuming success with the LG-1 Up-dip well (“we have a significant opportunity to go after a number of other targets that are also present here”).
Given the paradigm shift that Sonoro is authoring with this LG-1 appraisal well—shorter timeline, reduced cost, quicker cycle to production and reserves—“we’re also looking for other opportunities where we can take this model, leverage it, and bring down costs and time for further development,” he said.
“We’ve got some exciting days ahead here.”