Desire Drills Duster at Ninky Well

Desire Drills Duster at Ninky Well

Monday, April 18, 2011
Desire Petroleum plc

Desire advised that the 14/15-3 well on the Ninky prospect has reached a total depth of 2,620 meters in the Barremian source rock interval.

Ninky Well Results

Based on drilling and wireline logging, the well encountered two sand-prone sections in the Upper and Middle F2 intervals, which were the primary targets (2323 meters to 2334 meters and 2365 meters to 2389 meters). The sands have a combined gross thickness of 35 meters and oil shows were encountered throughout both intervals while drilling. The reservoir quality is generally poor having only 5.6 meters of net reservoir with an average porosity of 13%. A thin interval of around 1.2 meters at the top of the Middle F2 zone is interpreted to be oil bearing from log analysis.

Wireline formation pressure measurements were attempted, but no valid pressures were obtained, indicating that the reservoirs are low permeability at this location. As a result no wireline sampling was attempted. The depositional model suggests these sands are sourced from the east and therefore better reservoir quality may be expected downdip. In addition, there are indications from seismic of further sands along strike on the Ninky structural high, which were not penetrated in this well. These opportunities will be evaluated with the new 3D seismic as part of Desire's prospect inventory update.

Operations on the Ninky well will now be completed and the well will be plugged and abandoned. The well was drilling using the Ocean Guardian drilling rig and will now return to Rockhopper. Rockhopper will drill a minimum of 3 additional wells using the Ocean Guardian drilling unit. Rockhopper's next well is planned to be located near to the 14/10-2 discovery well. Specialist flow test equipment is due to be in the Islands in early May and Rockhopper intends to flow test the well if appropriate using this equipment to obtain a greater understanding than was possible during the test of well 14/10-2.

3D Seismic Update

The 3D seismic operations are ongoing with the Polarcus Nadia vessel, in a joint program with Rockhopper. To date, approximately 1485 km2 of data have been acquired in the Desire operated part of the program. Desire anticipates that a further 195 km2 will be acquired to complete the operated program. The joint survey is expected to be completed during May. Processing of the new seismic data is in progress and initial indications are that data quality is good. Priority areas have been identified in the East Flank play between Ninky and Sea Lion, and over the Ann/Orca South prospect. The processed data from these priority areas is expected to be available in July. The full, merged data will be available later in the year, which will provide coverage over the southern part of the East Flank play and the Helen prospect.

Desire remains optimistic that existing prospects can be significantly de-risked using the new seismic data and that new prospects will be identified, particularly within the East Flank play which is widely developed within the Desire operated licenses.

Stephen Phipps, Chairman of Desire, commented, "On completion of the Ninky well Desire will have funds of circa $37 million which, while more than adequate for our share of rig and vessel demobilization, completion of our 3D seismic acquisition, processing and interpretation plus general working capital needs, is insufficient to drill further wells. Given our continuing confidence that oil will be discovered on Desire's acreage, further wells will need to be drilled and, therefore, once the results of the Ninky well and the 3D seismic have been analyzed, we will review all financing options available with the intention of rejoining the drilling campaign later in the year if possible."