Quiet Find Trends Well for Keathley

Much Applause About Chevron’s Announcement

There’s been much applause about Chevron’s recent announcement of a 6,000 bopd test at the Jack 2 well in the Walker Ridge area of the deepwater Lower Tertiary play in the Gulf of Mexico.

But to many industry watchers, the Kaskida well discovery to the northwest of Jack 2 in Keathley Canyon Block 292 – announced about two weeks earlier – was far more significant in a number of ways.

The BP-operated Kaskida well reportedly was drilled in almost 6,000 feet of water to a depth of 32,500 feet.

The well encountered 800 feet of net pay, compared to 350 feet in Jack 2. In fact, the reported pay section is greater than any of the other discoveries thus far in the Lower Tertiary trend in the Gulf.

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There’s been much applause about Chevron’s recent announcement of a 6,000 bopd test at the Jack 2 well in the Walker Ridge area of the deepwater Lower Tertiary play in the Gulf of Mexico.

But to many industry watchers, the Kaskida well discovery to the northwest of Jack 2 in Keathley Canyon Block 292 – announced about two weeks earlier – was far more significant in a number of ways.

The BP-operated Kaskida well reportedly was drilled in almost 6,000 feet of water to a depth of 32,500 feet.

The well encountered 800 feet of net pay, compared to 350 feet in Jack 2. In fact, the reported pay section is greater than any of the other discoveries thus far in the Lower Tertiary trend in the Gulf.

But the significance of the Kaskida goes far beyond the amount of net pay.

“The BP well is the first established pay in the Keathley Canyon protraction area,” said Jim Flanagan at IHS Energy. “It shows the trend does continue between the areas to the east – where Cascade, Chinook, St. Malo and Jack were drilled – and what’s over to the west, where you have the Perdido fold belt and the Great White discovery made by Shell and some of the other discoveries made in that area.

“The BP well lends support to think that the trend actually extends from the Perdido fold belt area over to Chinook and Cascade,” Flanagan noted. The intrigue doesn’t stop here.

“Far more important than that discovery is that to the southeast part of the block in Keathley Canyon, Unocal drilled the Sardinia well several years ago,” said Bob Esser at Cambridge Energy Research Associates.

“It was a dry hole, but it reported 1,100 feet of sand in it,” Esser said. “What this is telling you is that the Keathley Canyon block has a lot of reservoir potential. All they need to do is find the trapping mechanism, which obviously was not there for Sardinia but is there for the Kaskida well.”

This serves to underscore the importance of the timing of oil migration and the need to have structure in place prior to migration.

“If migration in the Keathley Canyon area was occurring at the same time as it was over in Walker Ridge,” Flanagan said, “then you would want to identify structures at least as old as the Jack and St. Malo structures.”

Industry interest in this locale clearly is huge.

“In the last lease sale covering this area in August, six of the 10 highest-bid blocks were in Keathley Canyon,” Esser noted. “Those in the Kaskida well know the potential of this area, and those and others bid heavily on Keathley Canyon blocks.

“With all this new interest and the blocks already owned,” Esser said, “we would expect a heavy drilling slate coming up fairly soon.

“Where Chevron talks about three to 15 billion barrels in the trend, Keathley Canyon is where a lot of it will take place to get up to that number.”

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