From: Proactive Investors Australia
Solimar Energy (ASX: SGY) may target the Kreyenhagen shale in the northwest San Joaquin Basin, California, following a flurry of activity by other companies in the area over the last six months.
The company hopes the activity would result in the rapid development of well completion technologies to meet the challenge of producing from the Kreyenhagen shale as it did in other North American oil shales.
Hess Corporation – a new entrant into the California oil shale plays – is planning to drill 6 test wells updip and east of Zodiac Exploration’s acreage, where a deep horizontal well was recently flow tested at rates of 60 and 126 barrels of 29 degrees API oil.
The independent is believed to be targeting the Kreyenhagen shale.
Meanwhile, private company New Gulf Resources is well advanced in drilling an initial 3 well program targeting both the Monterey and Kreyenhagen shales on the flanks on the flanks of the Kettleman Domes.
Solimar has built up a gross 14,000 acre (56.6 square kilometre) acreage position in the northern San Joaquin Basin.
The company is currently focused on the heavy oil accumulations in the Temblor Sandstone that overlies the Kreyenhagen shale and has unrisked potential to hold up to 79.1 million barrels of oil net to Solimar.
However, an independent study has led Solimar to conclude that more than half of its acerage could hold thick oil shales of equivalent richness to those held by the larger companies.
The study by Sproule Unconventional Limited also found the Kreyenhagen Shale was a viable exploration target with potential for development with horizontal well technologies that have yet to be tried in the area.
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