Roxi Petroleum (RXP) spuds first well on Ravninnoe Asset

Roxi Petroleum (AIM:RXP) announced that it has spudded its first well on the Ravninnoe asset. This well, named Well #20, is effectively an offset from Well #8, drilled during Soviet times.

It has previously been announced that Well #8 tested oil at 6-800 barrels of oil per day (bopd) from the mid-Carboniferous horizon. The existing reserves associated with this field are quite modest, at 3.7 millons of barrels of oil (mmbo) proved + probable + possible.

However, the other holders of part of the Ravninnoe asset did at one time have their share of the asset up for sale through Envoi where it was disclosed that the mid-Carboniferous had expected Pmean gross reserves of 26mmbo (p7) and that there was also a deeper, lower-Carboniferous target with Pmean gross reserves of 27mmbo (p7). Roxi holds a 30% interest in the Ravninnoe block.

The July 2009 AGM Presentation (slide 15) shows the target depth of Well 20 is 3,800m with a production liner being set from 3,200m to 3,800m. This indicates Well #20 is being drilled to penetrate the lower-Caroniferous as well as the mid-Carboniferous. The GM held on 17 November indicated that Well #20 was not in an optimum location to test the lower-Carboniferous target, so they are unlikely to drill as far as 3,800m. However, it was stated that if they still had oil shows at 3,500m, they would keep going. Full report on GM here.

Today's announcement is ambiguous on the targets of the well, but if they do drill both horizons with this well, and achieve a positive result with both, then the impact on Roxi's reserves and production would be very significant indeed.