Senex Energy Limited (Senex, ASX: SXY) has quantified a significant contingent oil resource within the Murta Formation of South Australia's southern Cooper-Eromanga Basin that represents a material opportunity to deliver oil production from previously overlooked assets.
Senex engaged Dallas-based consulting firm DeGolyer and MacNaughton to undertake a regional study of Senex-operated assets where the potential for Murta Formation oil production had been identified and tested from conventional wells, and has been shown to be viable.
ABOUT THE MURTA FORMATION RESERVOIR
The Murta Formation is a regionally extensive package of thinly interbedded sandstone shale that lies above the primary production reservoirs of the Cooper-Eromanga Basin, as shown in Figure 1. The formation is commonly found to be highly oil saturated with net pay intervals of 4 metres to 16 metres in thickness.
Oil has been produced from the Murta Formation at Senex-operated fields with initial flow rates ranging from 20 to 200 barrels of oil per day. Production from Senex-operated fields such as Mirage and Padulla demonstrates that while initial production rates are typically modest, the long term stabilised rates are likely to decline at only 3-4% per annum, providing consistent production and cashflow.
A technical review of the formation in Senex-operated blocks in the southern Cooper-Eromanga Basin revealed large volumes of oil in place. The study also showed that in many places the formation can be classified as an unconventional resource, where the use of modern production enhancement techniques, such as those used in North America, will materially increase Murta Formation recovery factors, production rates and overall field economics.
Senex's current 30 well drilling program, which commenced in the southern Cooper-Eromanga Basin permits, has collected information required to further evaluate the formation. Core was cut through the
Murta Formation during recent drilling at multiple locations in order to quantify net oil pay, porosity, oil saturations and rock-strength characteristics. The cores were highly saturated with oil which, in many cases, conventional wireline logging could not identify