Empyrean Energy

Web site : http://www.empyreanenergy.com

Al would appreciate your views on the following article.
http://www.oilbarrel.com
cyril

http://www.oilbarrel.com/email_index.html?page=/news/article.html?body=1&key=oilbarrel_en:1193623438&feed=oilbarrel_en

29.10.2007

Empyrean Energy Gets Some Encouraging If Inconclusive News From Its Kennedy-1 Well On Its Sugarloaf Prospect In Texas

The latest drilling report from London AIM-listed Empyrean energy concerns its Kennedy-1 exploration well on the Sugarloaf prospect in Texas, US. The well is drilling ahead at a measured depth of 13,481 feet. The planned measured depth of this well is 17,570 feet.

Since its previous report casing was successfully run and cemented at a depth of 12,719 feet followed by the start of drilling the horizontal section within the target Austin Chalk upper zone. There are background gas levels broadly consistent with those found in shallower zones.

The re-frac of the deepest of the three zones of gas shows, and log interpreted potential gas play in the Cretaceous age Austin Chalk formation, was undertaken, with all of the Frac protant injected into the formation as per the programme. The lack of significant hydrocarbon recovery and the flow pressures seen, to date indicate that this deepest zone of the Austin Chalk is unlikely to be commercially productive at this location.

In other words, there looks as if there is gas in the shallower zones but we do not know how much at this point. Empyrean has assets in Germany but it is focused in the US, like other small independents from the UK and Australia, because the high prices available for gas and the good infrastructure make it worthwhile revisiting low risk discoveries which were not deemed worth exploiting by the companies which originally discovered them. The low cost nature of the assets means that even the most junior of companies can quickly build up a good cash flow business.

Sugarloaf is important to Empyrean because it represents a potential step up from the modest developments the company has achieved on Project Margarita, also in Texas. You are talking about the difference between hundreds of thousand of cubic feet a day to possibly millions of cubic feet a day from individual wells.

The Sugarloaf prospect covers 60 sq km in the prolific Gulf Coast Basin of Texas and lies just 6.6 km east of the producing Sugarkane gas-condensate field. Empyrean has a 6 per cent working interest in the Texas Crude Energy operated project which was first drilled in 2006 when Sugarloaf-1 found tight reservoir sands in the primary Cretaceous-aged Hosston formation.

This was a disappointment but the compensation was that there was at least 92 feet of potential gas play in a shallower secondary target, the age Carbonates. So the shallower zones looked prospective if the deeper ones dont.

On the basis of past drilling Empyrean extended its interests. It has farmed into a 12 well programme (Kennedy-1 is the first well) over Sugarloaf Block A and Block B. Empyrean will earn a 7.5 per cent interest in Block A by paying 12.5 per cent of the pre-production costs. The first well here, a horizontal appraisal of a putative gas reservoir, encountered encouraging gas shows.

Empyrean also has an 18 per cent working interest in Block B, where, as part of the programme, the Kennedy-1 well is taking place. It is early days but it is suggested there could be a multi-tcf gas target to be exploited.

There is also movement on Project Margarita, the other Texas asset. A six well drilling programme has meant output of around 2 million cubic feet of gas a day and some 60 barrels a day of oil. Empyrean has 44 per cent of this acreage, and at current prices for both oil and gas there is good cash flow.

But it was always agreed that if the shallow low cost/low risk wells came good, the partners would graduate to three deeper, high impact wells on Project Margarita. The first proposed prospect is a potential gas accumulation of between 15 and 48 billion cubic feet.

getting hammered daily cant see any positives of late.

http://www.investegate.co.uk/Article.aspx?id=200711010759397989G
This should creat some interest, and i see the SP has risen
cyril

So a 3rd well agreed in Block A by the successful operator,well worth reading Tom Kelly's comments.
cyril

UP almost 12% today gentlemen,i believe we have momentum here.If past preformance is anything to go by 60p(pre results) is quite achieveable.

cyril

News via our aussie jv in Bondi,not sure whether EME will release later?
http://www.asx.com.au/asxpdf/20071105/pdf/315mzn7ljs3j7q.pdf
cyril

http://www.investegate.co.uk/Article.aspx?id=200711050902200012H
cyril

Problems with Kennedy H 1 well, replacing the measuring while drilling tool?
Ref to aussie jvp's AUT, EKA.
cyril

niceonecyril - are you fan of Empyrean and what's your views, if I may ask?

I'm down 25% in a matter of weeks thinking this was a good one, but I've grown increasingly concerned EMpyrean has been hyped up and fell for the bait!

The messages and RNS's are mixed and seem a confused combination of positive, negative and evasive comments

Well i'm still holding,top sliced the other to get more BRR. EME has a great portfolio
and will come good,the Bondi well is expected to spud on the weekend. Theirs a
lot of activity going on in the S/Loaf, S/Kane (4 horizontals since the discovery of
gas/condensate) +a lot increased acreage.So the JVP's including a major have a lot of confidence,(it should be remembered its the top zone where the real hope lies) but only time will tell. I think that the SP will go north as we get closer to the results and will give an opportunity to top slice.
Frustrating stock this so much potential but never quite getting there, at the moment?
imo
cyril

Conformation ofBondi's spudding.
http://www.investegate.co.uk/Article.aspx?id=200711080746572655H

Unfortuneatly the market having a bad(or spell)so we will lose the impact of this news?
cyril

well the ftse is now in positive territory unlike the eme sp.

EME are quite capable of produceing great results, and soon thease will be apperent that the Sugarloaf-1 will be enhanced by this company as the Sp will literally rise to 93-97p and higher.

By the time EME produce anything worthwhile, the internal combustion engine will probably be extinct.

New coming today I think, this from ADI on ASX.


"Kennedy #1H Well

Adelphi Energy Limited advises that the Kennedy-1 exploration well has reached Total Depth of 16,750 feet Measured Depth and is running logs prior to casing for completion and testing. Total depth was called some 820 feet short of the original proposed measured depth of 17,570 feet for operational convenience.
Background gas levels whilst drilling in the Austin Chalk upper target zone remain in the range of 40 to 300 units; the commercial significance of which will not be known until testing operations are completed.


Sugarloaf-1 Well

Post fracture stimulation logs have now been run and are being analysed. The lowermost Austin Chalk interval that was previously fracture stimulated has been put back on flow test and on 11 November commenced flowing gas at a rate of 387,000 cubic feet per day with approximately 335 barrels of water (mostly frac fluids) per day. As at report time on 13 November, the well had declined to 180,000 cubic feet per day with minor quantities of water. Over the final 5 hours of the report period, 39 barrels of condensate had been produced. The significance of these flows will not be known until the testing of the zone has been completed and analysed.
Adelphi, through its wholly owned US subsidiary Adelphi Energy Texas, Inc., has a 20% interest in the Sugarloaf Project which includes the Sugarloaf-1 and Kennedy #1H wells."

Excellent. We'll be able to cook the turkey then. Wonder what we do after that. ;-)))

You move up to the next zone and see if you can find a bigger turkey. Something that hopefully will feed you a bit better!! Maybe it will turn out into a chicken that will lay a golden egg.

Then again, it may be suffering from the flu, John. Well H5N1? ;-)))))

http://www.theaustralian.news.com.au/story/0,25197,22740709-18261,00.html


...................Aurora, which closed on Friday at 48c, thought it had left itself enough time since announcing the rights issue in July. The idea was that results would be in from the Sugarloaf-1 well in Texas, of which it has 20 per cent, and these would encourage shareholders to take up the issue.

But delays of various sorts put paid to that plan, and those results are still awaited (as they are at Adelphi Energy and Eureka Energy, which also have stakes in Sugarloaf).

But the words is that the underwriters aren't sweating, given the goal at Sugarloaf is several trillion cubic feet of gas along with condensate...........................