NEWS BULLETIN

March 31, 2020 --- Vol. 26, No.17March 2020

Successful testing completed at Oil Search exploration wells

Last night Oil Search released drilling test results from this winter's exploration season at its North Slope Mitquq and Stirrup prospects.

Testing of the Brookian Nanushuk reservoirs encountered in the Mitquq 1 ST1 and the Stirrup 1 wells was completed and were very encouraging, per Keiran Wulff, the company's managing director.

Mitquq 1 ST1, a sidetrack from the Mitquq 1 oil discovery, located 5.6 miles east of the proposed central processing facility of the Pikka unit development, encountered a net pay zone of 172 feet with a gas cap of 29 feet. On test, the well flowed at a stabilized rate of 1,730 barrels of oil per day from a single stimulated zone.

The company said high quality oil in a deeper reservoir at Mitquq was also discovered but not tested, possibly a reference to the Torok formation, another Brookian play.

The Stirrup 1 exploration well, approximately 7.5 miles west of the 2017 Horseshoe discovery well and 22 miles southwest of the proposed Pikka unit development infrastructure, encountered an oil column with net pay of 75 feet. On test, the well flowed at a stabilized rate of 3,520 bpd from a single stimulated zone.

Flow tests in both wells included a cleanup, flow period and a pressure buildup prior to the final flow test to assess well deliverability.

"We are very encouraged by the success of our 2019/20 Alaskan exploration program, with oil discovered in all three penetrations, at Mitquq 1, Mitquq 1 ST1 and Stirrup, and excellent flow rates achieved in the two well tests," Wulff said.

"At present, Oil Search does not plan to pursue an exploration drilling program in the 2020/21 winter season and will focus on maintaining capabilities, advancing work needed to comply with permitting obligations and pursuing opportunities to minimize costs and add value to the Pikka unit development. This will enable the Company to respond quickly when oil prices improve. The Company remains committed to progressing the Pikka unit development," he said.

Oil Search has said that success at the Stirrup prospect could de-risk additional fairways to underpin a possible standalone Horseshoe development, noting Stirrup is a direct analogue to the Horseshoe 1 Nanushuk discovery.

Oil Search has referred to the Mitquq prospect as a "high value tieback" to future Pikka infrastructure.

With testing complete at both well locations, the crews are demobilizing and expected to be off-location by mid-April.

In addition, the winter season early civil works program, which has included the construction of ice and gravel roads, gravel pads and a bridge, is expected to be completed shortly, with all crews, equipment and support infrastructure to be demobilized by the end of April.

- KAY CASHMAN

See full story in April 5 issue, available online Friday, April 3, at www.PetroleumNews.com

For information on PN's news bulletin service, call 907-522-9469.

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