TPL: Doris Is Nice—Will Daphne Be Nicer?

Canaccord Genuity's Morning Coffee (02/24/2010)
"Doris is nice—will Daphne be nicer? Tethys rallied after providing details on the testing of the recent AKD-01 (Doris) exploration oil discovery on the Akkulka Block in Kazakhstan. It was previously announced that the AKD-01 well flowed oil at a combined rate in excess of 6,800 barrels per day. The company says the upper Cretaceous sandstone interval showed 'extremely good' permeability (in excess of 1.7 Darcy) and a large investigated distance (in excess of 10 km) and therefore a large connected volume (some 29 million stock tank barrels). This indicates a very high-quality laterally extensive reservoir. The lower Dolomite zone also showed good permeability with a large investigated distance and significant connected volume; however further testing is required to confirm the lateral extent of the reservoir, though Tethys has now interpreted a similar zone in a previously drilled well over 16 km to the west. Tethys plans to drill at least two appraisal wells on the AKD-01 oil discovery to evaluate and establish the size and potential of the discovery and provide the necessary data to obtain a production contract. In addition, Tethys plans to carry out a 3D seismic survey over the Doris discovery and shoot additional targeted 2D seismic lines to firm up further potential in the area. Tethys has identified several other prospects in the area that appear similar to the Doris oil discovery, and now that a hydrocarbon system has been proven at the deeper levels, the risk on these prospects is reduced significantly. Tethys is now in the process of demobilizing its rig from the AKD-01 location to a prospect located in a similar structural position some 50 km to the north-west that has been named 'Daphne.' This well is expected to commence operations in late April and is planned to target the Cretaceous, Jurassic, Triassic and Permo-Carboniferous intervals. Further exploration drilling on the large surrounding Kul-Bas block is then planned."

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