Hi Buckey:
More good news as another company Pan-Ocean Exploration joins the West Coast Oil
Play.Today, the company announced an agreement with Mobil to earn up to a 60%
interest in exploration permit 96-113 by drilling a $1million slim hole test well.
Additionally, Pan Ocean can earn up to a 10% interest by acquiring 50 km. of seismic
data on permit 96-116...and up to 60% interest on the permit by drilling an 8000 ft slim
hole test well.
This Oil Play is beginning to attract the attention it deserves from investors and oil
exploration companies alike.The activity in this area of Newfoundland is going to be
continuing for quite some time.
Here is the company's press release:
Pan Ocean to farm in on Mobil Canada's West Newfoundland acreage
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>Pan Ocean Explorations Inc POE
>Shares issued 3,031,035 Apr 1 close $0.54
>Mon 5 Apr 99 News Release
>Mr. Constantine Grey reports
>The company has reached a farm-in agreement with Mobil Canada. The
>agreement pertains to oil exploration on two properties onshore in Western
>Newfoundland, referred to as the York Harbour project, and involves a land
>package totalling 75,448 gross hectares (186,357 acres).
>Under the terms of the agreement, Pan Ocean will earn a 60 per cent working
>interest in exploration permit 96-113, which comprises 37,950 hectares
>(93,736 acres) on the south side of the Bay of Islands, Western
>Newfoundland. Pan Ocean will earn its interest by drilling an 8,000 foot
>continuous core slim-hole well to test objectives within the Ordovician
>carbonate platform succession. This well is planned to commence in the late
>spring or early summer of 1999, and is estimated to cost approximately
>$1-million.
>In addition, the company will have the option, exercisable within 60 days
>of the rig release of the York Harbour well, to earn a 10 per cent interest
>in exploration permit 96-116, which comprises a further 37,498 hectares
>north of the York Harbour project. The company must acquire 50 kilometres
>of seismic data on this permit to earn this interest. As well, if within 90
>days of seismic completion the company elects to drill an 8,000 foot
>slim-hole well on the permit, the interest can be increased to 60 per cent.
>West Newfoundland has recently been the focus of renewed petroleum
>exploration as several major companies have returned to explore in the
>area. Recent increases in the spot price of crude oil and announced OPEC
>cutbacks have added to the prospective nature of the project. The
>PanCanadian Petroleum Shoal Point K-39 well was spudded in early February
>of 1999. This well is planned to drill to a minimum depth of 2,700 metres
>at a cost of approximately $10-million. According to the most recent depth
>information available, the well is estimated to have reached a depth of
>2,173 metres. Other partners in the well include Hunt Oil Company, Encal
>Energy Ltd. and Mobil Canada. The well is being deviated from land to test
>carbonate platform reservoirs within a large structure underneath Port au
>Port Bay.
>Although petroleum has long been known to be present in the area from
>surface seeps and very shallow production wells, the modern phase of
>exploration in Western Newfoundland commenced late in the 1980s. The
>exploration efforts have been aided by the acquisition of modern detailed
>seismic data.
>Four deep wells drilled in the immediate vicinity of the Port au Port
>Peninsula between 1994 and 1996 resulted in one discovery and three dry
>holes. Although the initial Port au Port No. 1 well flowed light oil from
>two zones at a rate totalling over 3,200 barrels per day, the commerciality
>of the discovery awaits further delineation. Most significantly, this well
>established the presence of an active petroleum system and hence the
>viability of the play. These four wells provided valuable information to
>set the stage for a second round of exploration by PanCanadian and partners
>in the Port au Port Bay area, culminating in the acquisition of an
>onshore-offshore transition zone seismic survey and drilling of the K-39
>well, currently in progress.
>Pan Ocean's farm-in lands lie approximately 50 kilometres northeast of, and
>along the same favourable geological trend, as the PanCanadian Petroleum
>Shoal Point K-39 well. The slim-hole test well will be drilled
>approximately 20 kilometres west of Corner Brook, along an existing road
>access.
>Sourcing, trapping and reservoir conditions in the Bay of Islands area are
>believed to be as favourable to those of the Port au Port area. Hunt Oil
>Company has stated publicly that the Shoal Point structure could contain
>over 100 million barrels of oil. Petroleum exploration in Western
>Newfoundland is exciting because it provides a combination of West Texas,
>Ellenburger-type carbonate reservoirs and structural configurations
>analogous to the foothills of Alberta. Both these prolific oil-producing
>areas are rich in petroleum, and the latter contains fields, such as Turner
>Valley, with recoverable reserves in excess of 100 million barrels of oil
>equivalent.
>Furthermore, the farm-in lands lie within the thickness accumulation of the
>Humber Arm Allochthon, a geological unit stretching 200 kilometres along
>the west coast of Newfoundland, which contains the important rich source
>rocks and stratigraphic traps essential for accumulations of hydrocarbon
>reservoirs.
>Pan Ocean management is convinced that the York Harbour project is
>strategically and geologically within the centre of the core area of this
>Western Newfoundland play. In addition, Newfoundland's fiscal terms for
>petroleum exploitation are extremely favourable and are comparable to those
>of Alberta.
>These factors have contributed to management's decision to aggressively
>position Pan Ocean as a key player in this oil exploration project.
>(c) Copyright 1999 Canjex Publishing Ltd. canada-stockwatch.com
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