Saturday, June 6, 2009

Uganda: Oil Drilling Starts in West Nile Region

New Vision, Frank Mugabi, 4 June 2009

DRILLING of the first oil exploration well in the Rhino Camp Basin in West Nile has started. This follows the arrival and assembling of a MBU-125 land-drilling rig that was mobilised from southern Sudan.

Tower Resources Plc, the mother firm of Neptune Petroleum Uganda, which is undertaking the venture, said in a statement that Iti-1 exploration well kicked-off last week.

The oil well was named after the tamarine tree (local known as Iti), which is dominant in the exploration area.

"Operations should take two to three weeks.

"Further announcement will be made once results of the well have been determined," the statement said.

The company indicated that a prospective oil reservoir horizon was expected to be encountered in about a week.

The drilling programme in Exploration Area 5 (EA5), covers Arua, Moyo and Yumbe districts. It started in February last year with the undertaking of 2D seismic and geochemical data surveys, which confirmed the presence of large structures and active hydro-carbon generation and migration. The firm rated the area as being of "low risk and potentially high reward."

The group's annual report for 2008, also hinted that EA5 had high potential taking into account Tullow Oil's discoveries in Block 2, some 150km away, and the Kingfisher discovery by Heritage further south in Block 3.

"The seismic processing for EA5 revealed that the miocene sediments prevalent in other areas of the Albertine Basin have a maximum thickness of 1500 metres, which is in line with sediments in EA1, to the south of Tower's License EA5, where Heritage has made a world-class discovery 80km from the first Neptune well."

It also said the circumstances were similar to the Butiaba area of License EA2 where Tullow recently made several significant discoveries. Uganda is exepected to start commercial oil production next year.