Lane Energy Poland: All Proceeding as Planned
Commenting on the progress made by the its subsidiary Lane Energy Poland, Alexander Fraser, Chief Executive of 3Legs Resources plc. said all was going well with drilling on the Baltic Basin.
Fraser spoke with Natural Gas for Europe on Friday.
An early entrant in the European shale gas exploration, 3Legs has secured six exploration and prospecting licenses covering approximately 1,000,000 acres (approximately 4,000 square kilometres) in the on-shore Baltic Basin region of Northern Poland
The Baltic concession area has all the geological attributes, including a thick and organically rich rock formation, to become a successful shale-gas development.
Targeted at the Silurian and Ordovician shales, Lane Energy’s first vertical well, #1LE Łebień located in the Lebork concession, reached total depth on July 28th.
Mr. Fraser said that testing from Łebień was on-going and that results were not expected until late this year.
Prior to the commencement of the drilling at Łebień, Kelly Scott, of Lane Energy’s operations in Poland, told the Rzeczpospolita daily that “the probability that the drilling will end in success is very high.”
Lane Energy’s second vertical exploration well, Legowo LE1 well, was spudded on August 27th
Located in the Cedry Wielkie concession, the Legowo well, is approximately 20km south of Gdańsk and just north of the town of Pszczołki. As with the Łebień, well, it is targeted at the Silurian and Ordovician shales.
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The Legowo well is expected to reach total depth shortly.
Trailblazing
Fraser previously described the first well as being a "proof of concept" or "science well".
Though research conducted by 3Legs has shown a high probability of shale gas, the most recent geochemical analysis dated back 20 years old and is not optimal for laboratory analysis. Drilling vertically through the formation will allow 3Legs to extensively log and core the formation and remove rock samples for analysis.
The Company is hoping to confirm the extent and thickness of the formation, the organic richness and thermal maturity of the rocks and most importantly, for presence of gas in the rocks.
3Legs plans to drill a third well on its Baltic concessions, but Fraser indicated that there had been no decision taken as of yet on which concession drilling was to occur.
The present drilling is being conducted in association with ConocoPhillips. In August 2009, 3Legs and ConocoPhillips, the third largest integrated energy company in the US, entered into an agreement to jointly evaluate the potential of Lane Energy's six Baltic Basin licenses.
Fraser commented that drilling success in the Baltic region would result in early stage (pilot) production in about two years, with large-scale production a minimum of four-five years out.
New Partnerships
3Legs also disclosed that is seeking partnerships for its concessions in Krakow region of Southern Poland and in Baden Württemberg region of Southern Germany.
The three licenses in the Krakow block in Poland consist of approximately 620,000 acres and contains an estimated 900 million barrels of oil equivalent in recoverable resources, with prospect in both unconventional gas and unconventional oil plays.
The German concession consists of two licenses in the Baden-Wurttemberg block, approximating 630,000 acres
Mr. Fraser said that this was a normal course decision and not reflective of any change in the Company’s strategic plan. 3Legs is working with IndigoPool in offering farm-in opportunities.
Results Eagerly Awaited
3Legs' activities in the Baltic Basin are being closely watched by numerous groups as an early indicator for the prospects of shale gas development in Europe.
Privately owned and funded since inception in 2007, 3Legs is not compelled to provide open disclosure of the success of it drilling. The release of news from its publicly traded partner, ConocoPhillips, would be dependent upon materiality to ConocoPhillips.
When asked if a public listing was in 3Legs' future, Fraser said that this was one of the options being considered.
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UPDATED: Click here for Schlumberger Press Release dated September 20th