Pura Vida Energy spuds high impact well offshore Morocco

Exciting times for backers of ASX-quoted Pura Vida Energy, with news that the Atwood Achiever drillship has spud the MZ-1 wildcat offshore Morocco. The well is being drilled in more than 2,000 metres of water to a depth of 5,600 metres with the potential to deepen to 6,150 metres in order to test up to five independently risked, stacked prospects.

The well will take two to three months to drill, with preliminary results due once it has drilled through the shallow Cretaceous target and again when it has gone through the deeper Jurassic targets.

This is a key piece of oil and gas real estate with Pura Vida’s Mazagan permit neighboured by the likes of BP, Kosmos and Chevron. Pura Vida itself has a 23 per cent stake in the project, which is operated by US natural resources giant Freeport McMoRan.

The US company’s farm-in underscored the potential of this acreage, with Freeport McMoRan footing the bill for up to US$215 million of drilling costs on this and a second well. There is also a useful equity dilution option to safeguard the ASX explorer, which ended March with A$20 million in cash, from any cost over-runs on the well.

This is a big well. MZ-1 will test total gross mean prospective resources of over 1.4 billion barrels (328 million barrels net to Pura Vida), with a high case of over 3 billion barrels. The location of the deepwater well, designed to test between four and five independent targets, helps to derisk the project and maximise the amount of data that can be recovered from the well.

In the Cretaceous the well is expected to intersect large structural four-way dip closure at two levels and in the Jurassic it will target large turbidite basin floor fans that are combined stratigraphic/structural traps. The Jurassic fans are interbedded within the expected source rocks of the basin and thus are ideally positioned to receive migrating hydrocarbons directly from the source rocks into the fan systems and carrier beds.

In the event that the fan systems are not effective traps then migrant hydrocarbons are likely to pass vertically up into the younger Cretaceous structural anticlinal traps. That, at least, is the theory, which is now being tested by the drillbit, lining up an exciting summer for shareholders.

Pura Vida managing director Damon Neaves said he welcomed the start of drilling operations. “This is a high impact event for Pura Vida, with the potential to be transformational for the company”.