Oilex (ASX:OEX, LON:OEX) continues to produce light oil from the Cambay 77-H well in India.
The well is continuing through the clean-up process and the well continues to flow back light oil, gas and frack water.
While the gas is being flared, oil produced from the well is being transported and sold to a nearby refinery for a price described by Oilex as being similar to Bonny Light Crude – the Nigerian ‘high grade’ benchmark.
The oil has an average API of 48.3 degrees (the highest observed as 50.1 and the lowest 43.6).
"It is a nice sweetener to continue production of crude oil which sells for an attractive price during flow-back and clean-up as some North American wells only flow water during early clean-up,” said managing director Ron Miller.
“To date, the data collected continues to support Cambay-77H as capable of being a high performance well compared to previous well designs consisting of vertical or deviated wells with single fracks in the Cambay Basin.”
Oilex said the hydrocarbon liquid to gas ratio has thus far been calculated as 130 barrels per million cubic feet. This is 300% higher than anticipated.
RFC Ambrian analyst Stuart Amor said: “We believe that the Cambay-77H well is continuing to prove to be a commercial well with light oil/condensate that is attracting a competitive market price.”
Samples have now been sent away for analysis.
The company has also confirmed that analysis of the water flowing from the well indicates it is frack water not formation water.
It also reported one teething problem with a partial clogging within the well bore identified during the clean-up process. Oilex said it appears to have been caused by residue from the breakdown of a polymer gel used in frack fluid.
The company explained this is not uncommon and it can be treated using proven techniques – with a chemical flush.
“As the first well of this type in the Cambay Basin to ‘flow-back and clean-up’, it is not unexpected for some remedial work as part of those operations,” Miller added.
