Noble Energy, Delek, Ratio start drilling Dolphin 1

Dolphin 1 Exploratory Prospect is located in the Hanna license, near Leviathan, 100 km west of Haifa.

The Sedco Express rig today began initial exploratory drilling of Dolphin 1 Exploratory Prospect, located in the Hanna license, near Leviathan. Dolphin 1 drilling will take place 100 km west of Haifa, and the purpose of the drilling is to discern if there is natural gas in Dolphin 1. Netherland, Sewell & Associates, Inc. (NSAI) best estimate of the gross natural gas reserves at Dolphin 1 is 550.5 billion cubic feet (BCF), with a geologic probability of success of 73%.

The drilling is based on the report by NSAI. Well operator, Noble Energy Inc. (NYSE: NBL), owns 39.66% of the license, Delek Group Ltd. (TASE: DLEKG) and Avner Oil and Gas LP (TASE: AVNR.L), each own 22.67%, and Ratio Oil Exploration (1992) LP (TASE:RATI.L) owns 15%.

The decision to drill is partly based on NSAI's prospective resources report. The resources report also says that if there is a gas discovery, based on previous experience in developing similar fields, best estimate has a reasonable chance of being commercially viable.

The drilling will be implemented in two phases. The first phase, is based on Noble Energy's recommendation to take advantage of the time needed for periodic treatment of the rig's blowout preventer (BOP) system. The rig is currently drilling the initial well at Tamar. The first phase will only drill to a depth of 2,560 meters, and will not reach the target strata. Casing pipes will be installed during the first phase, which will strengthen the borehole with cement.

The well's second phase will be drilled later, apparently using the same rig. The two phases are expected to last two months, with the first phase lasting only two weeks. The total budget of both phases, not including production test costs, is $51 million, $8 of which is for the first phase. The final drilling depth is expected to reach 6,000 meters, including 1,560 meters of water, to the target strata 1,440 meters.

Dolphin 1 is one of the 3 dolphin prospects in the Hanna license. According to the NSAI prospective resources report, Dolphin 1 has the largest potential for gas, and for now is the only prospect that has been chosen for exploratory drilling.

Published by Globes [online], Israel business news - - on August 29, 2011

© Copyright of Globes Publisher Itonut (1983) Ltd. 2011

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