Petroleum Prospecting License 340


Kina was awarded 100% working interest in PPL 340.

Location and Infrastructure

PPL 340 covers an area of 4,212 km2 onshore and is located within the Eastern Papuan Basin in the Gulf and Central Provinces and extends into the National Capital District. The licence comprises a contiguous area of 43 graticular blocks running from Port Moresby to the northwest. The balance of the licence comprises a single graticular adjacent to PPL 339, 6 graticulars east of Kerema and an isolated pair of graticulars north of the main body of the licence.

It is adjacent to the capital Port Moresby, the PNG LNG project site and the Puma (formerly InterOil) Refinery. Access to Port Moresby and proximity to the coast and plant sites may enable economic development of modest sized discoveries in this area.

Geology

PPL 340 overlies a tightly folded narrow shelf south west of the Owen Stanley Metamorphic Belt. Offshore seismic shows an accretionary wedge thrust over Mesozoic and Tertiary section to the south and west of PPL 340.

A fairway of good quality late Cretaceous reservoir is interpreted from outcrop of the Pale Sandstone in PPL 339 to the Barune Sandstone outcrop in Port Moresby. A carbonate reef play is viable with Eocene reefs proximal to PPL 340 as well as within the Early Miocene (Fairfax and Boera Formations) and the Plio/Pleistocene (Wedge Hill Limestone). Offshore PPL 340 Kapuri 1 (1968) tested water at a rate of 2,640 to 4,800 BWPD from the Kapuri Limestone.

An active hydrocarbon system is supported by: Gas in Oroi 1, gas flows from Tovala 1A, oil shows within the Oiapu bores, oil recovery from side wall cores at Iokea 1, gas shows in Wedge Hill Limestone at Black Bass and indication of thermogenic hydrocarbons in the recently suspended Wahoo-1.

Previous Exploration

No data has been located for the only well drilled in PPL 340, Rorona 1. Most wells and bores are pre-1950 with limited seismic data coverage but recent drilling activity by InterOil include Black Bass 1 and Wahoo-1.

Published outcrop maps show significant structuring with Miocene to Eocene carbonate development.

Exploration focus is on possible reef trend extending from the north of Oroi-1 into PPL 340. This will require new seismic acquisition in an area of relatively easy access. Aeromagnetic and aerogravity data has been acquired in advance of this.

Proposed Exploration

Interpretation of the proprietary aerogravity and aeromagnetic survey over PPL 340 has high-graded three structural leads within PPL 340 and southeast of Wahoo-1: Port Moresby, Rorona Updip and Lizard.

The Lizard prospect is coincident with a ridge that demonstrates structuring in the upper Miocene conducive to carbonate growth. It has is a shallow objective (approx. 650m depth) and is only 100km by road from the city of Port Moresby. The prospect is adjacent to a structural trough which is capable of generating thermogenic hydrocarbons, based on Wahoo-1 and Tovala-1 results.

Port Moresby prospect is a shallow objective (approx. 800m depth) where the target overlies a coincident gravity anomaly to the south of gas intersected in Oroi-1. It lies on an aerogravity high which appears to form part of the Kapuri platform. Seismic suggests a reef build up or rollover along a northwesterly plunging trend of uplifted and outcropping Port Moresby Association rocks to the southeast. Port Moresby is in a dry gas drainage catchment.

In Q3 2014, Interoil suspended drilling of Wahoo-1 due to the intersection of very high formation pressures within the Orubadi mudstone which contained thermogenic hydrocarbons. This considerably upgrades the liquids potential of northern PPL 340 as Wahoo is located less than 20km from the boundary of PPL 340. At present there has been no resumption of drilling at Wahoo-1.