Buccaneer spuds second Kenai Loop well

Buccaneer Energy Ltd. spud the Kenai Loop No. 2 well on Aug. 27, the company said.

The Australian independent said that as of Aug. 29 the step-out well reached a depth of 3,050 feet and crews were preparing to set the surface casing. The company said it expects drilling to take 30 days to reach 11,000 feet, with an additional 14 days of testing.

Kenai Loop No. 2 is an onshore directional well drilled from the same pad as Kenai Loop No. 1, but targeting a bottom hole location approximately 1,800 feet from the first well.

Buccaneer is drilling Kenai Loop No. 2 using the Marathon Oil Co. Glacier No. 1 drilling rig, the same rig it used to drill and test the Kenai Loop No. 1 well earlier this year.

The company plans to test the same zones at 9,700 and 10,000 feet it tested in the first well, as well as a zone at 10,600 feet not tested in the first well because of rig availability.

Buccaneer recently signed a gas supply contract with Enstar Natural Gas Co. that requires it to complete two new Kenai Loop wells, one by this November and another by November 2013. Under the contract, Buccaneer will initially deliver 5 million cubic feet per day to Enstar with an option to increase to 15 million cubic feet per day after six months.

Buccaneer said that Kenai Loop No. 1 flowed at an initial rate of 10 million cubic feet per day.

—Eric Lidji