CVN - Carnarvon Energy

[greggles]

Oil discovery for Carnarvon Petroleum at the Dorado-1 well.

Highlights

• Significant oil discovery in primary target, the Caley Sandstone
• Excellent reservoir and fluid characteristics
• Caley Sandstone contains a net oil pay thickness of 79.6m
• Hydrocarbon bearing sands also identified in Baxter Member
• Additional potential in Crespin and Milne Sandstone still to come

Carnarvon Petroleum Limited ("Carnarvon" or "the Company"; ASX:CVN) confirms that the Quadrant-Carnarvon Joint Venture has made a significant oil discovery in the Caley Member as part of the current Dorado-1 well drilling campaign.

Light oil has been recovered from excellent reservoir containing a gross hydrocarbon package of 96.1 metres and a net pay thickness of 79.6 metres in highly porous and permeable sands.

The results were confirmed after wireline testing was undertaken at the Dorado-1 well, after it drilled down to around 4,044 metres Measured Depth ("MD") MD in 8-1/2” hole. Currently the well is still in a hydrocarbon bearing column.

Carnarvon Managing Director Adrian Cook said the result is transformational for the company.

"This is a significant discovery given the quantum of the net pay thickness, the quality of the oil and the extremely good reservoir characteristics," Mr Cook said.

"Currently, we estimate the net oil pay is around 80 metres, with more drilling still to come this is very exciting for Carnarvon Petroleum.

"With multiple targets still left, the focus now is to complete the drilling program through the Baxter, Crespin and Milne Members.

In April we highlighted the possibility that the Dorado structure could contain a substantial oil accumulation. Given this outcome has now occurred, Carnarvon will make an assessment of and issue a revised volume estimate as soon as we possibly can once drilling operations have finished."

CVN has gapped up on heavy volume this morning and is currently trading at 25.5c, up 44.71%. I have no idea how to value oil discoveries like this. Anyone else have any insights?

 

[barney]

Pity @Agentm is not still around. He'd give us all the ins and outs of this.

80 metres of Pay zone looks potentially huge and the share price is reflecting that … up another 23% today to close on its high of 34 cents

Flow Rates will be interesting.

 

[JTLP]

Pity @Agentm is not still around. He'd give us all the ins and outs of this.

80 metres of Pay zone looks potentially huge and the share price is reflecting that … up another 23% today to close on its high of 34 cents

Flow Rates will be interesting.

I held this for so long and ditched awhile ago when they got Phoenix underway. Welp - should have stuck by them.

 

[greggles]

Wow. What a run. I had no idea CVN would rise so far so fast. No real signs of slowing down yet. It will be interesting to see where it finally settles.

A great result for those holding.

 

[BlindSquirrel]

I lassoed this rocket around 26c. I'm currently enjoying the ride. When something changes I hope to be quick enough to jump off!

 

[tech/a]

I lassoed this rocket around 26c. I'm currently enjoying the ride. When something changes I hope to be quick enough to jump off!

This is likely around now.

 

[HelloU]

This is likely around now.

hour and a half of profit taking slide and it just stopped....nerves of steel those DT peeps

 

[tech/a]

 

[HelloU]

hour and a half of profit taking slide and it just stopped....nerves of steel those DT peeps

until 2:30....then it was every person for themselves.

 

[tech/a]

 

[barney]

[][]

Tech … MCA Chart accidentally instead of CVN …. Cheers

 

[tech/a]

Bloody hell that's what you get for rushing!!
All at home so sorry no chart!

Yesterdays return to form is a test of the high but I note with
some volume so supply is evident.
Don't see new highs here!

 

[barney]

Bloody hell that's what you get for rushing!!
All at home so sorry no chart!

Yesterdays return to form is a test of the high but I note with
some volume so supply is evident.
Don't see new highs here!

All good. Joe will be able to delete it if you get time later to post the other one later.

 

[BlindSquirrel]

I'm still in on CVN. Another positive announcement. SP opened higher but returning to yesterday's territory again. Double Down?

 

[barney]

I'm still in on CVN. Another positive announcement. SP opened higher but returning to yesterday's territory again. Double Down?

CVN is still behaving … A move above 50 cents would be very positive. A close below 44 cents potentially negative.

 

[BlindSquirrel]

And a trading halt at on open @ 48.5c. Here's hoping for good news! We'll find out in 2 days.

 

[greggles]

And a trading halt at on open @ 48.5c. Here's hoping for good news! We'll find out in 2 days.

Good news for CVN holders. Additional oil discoveries in the Crespin and Milne Members of the Dorado-1 well.

Light oil has been recovered from the Crespin Member containing a gross hydrocarbon package of 50 metres and a net oil pay thickness of 22 metres. The quality of the reservoir encountered was better than pre-drill estimates with average porosities of 14 per cent.

Light oil was also recovered from the Milne Member containing a gross hydrocarbon package of 30 metres and a net pay thickness of 18 metres. The average porosity of 13 per cent was also better than the pre-drill estimates.

Pressure data has confirmed that the Dorado structure contains multiple oil columns in the Caley, Crespin and Milne Members and a gas and condensate column in the Baxter Member, aggregating to a total net hydrocarbon pay of 132 metres. The Caley, Baxter and Milne sands did not encounter any water, whereas the lower section of the Crespin sand contains an interpreted water contact.

Not unexpectedly, the share price jumped on the news and is currently up 27.32% to 61.8c. Huge volume of around 85 million shares.

 

[BlindSquirrel]

Updated Euroz research note, upgrading from spec buy to buy and a target of $1/share (FWIW)

Oil Discovery at Dorado-1Investment CaseDorado is a material oil discovery and one of the largest ever in Australian waters. Moreover, the Oil Water Contact (“OWC”) has not been encountered in the uppermost Caley lowermost Milne reservoirs and had drilled through an additional 40m net oil pay. What we like is that oil discoveries in shallow water and benign jurisdictions have relatively low barriers to commercialisation. Recovering oil prices are stimulating permitting and M&A activity in the E&P industry: this result will clearly shine a corporate spotlight on CVN. The WPL transaction with Finder Exploration is a good example and we believe similar moves are afoot particularly focused on the Dampier Sub-Basin and emerging Triassic play that CVN and Quadrant have identified at the Phoenix Hub. We upgrade to a Buy recommendation, with an increased Valuation of $0.84, and a $1/sh Price Target believing that CVN has made a commercial oil discovery in the NWS, will likely define a second gas condensate development with success at Phoenix South-3 and can also take the Buffalo oil project through to commercialisation.Key Points

• Wireline has confirmed an additional oil discovery within the Secondary Crespin and Milne Sandstone reservoirs at the Dorado-1 location;
• Results have confirmed:

• • Net oil pay of 40m;
  • Highly porous (Crespin 14%/ Milne 13% avg.) reservoir;
  • Resistivity supportive of excellent permeability;
  • Total hydrocarbon net pay now 132 metres in the Dorado-1 well.

• The secondary targets of Crespin and Milne is mapped to contain P50 gross mean volumes of 125mmbboe (CVN – 20%), comprising 67mbbls condensate and 1386Bcf gas;
• The Caley, Baxter and Milne sands did not encounter any water, whereas the lower section of the Crespin sand contains an interpreted water contact.
• We note preliminary rock characteristics have exceeded pre-drill expectations, placing an upside bias to Dorado volumetrics;
• Volumetric estimates will take circa 4 weeks to compile after the completion of the well following this announcement;
• We upgrade our Recommendation to a Buy (prev. Spec Buy), with a Price Target and Valuation of $1.00/sh (prev. $0.50) and $0.84/sh (prev.$0.44) respectively.
• We look to the nearest peer in FAR as a relevant comparison, noting that the market ascribes A$9/bbl for its net (post Govt carry) 2C discovered 70mmbbls contingent resource;
• What we like about an oil discovery as the commercialisation pathway is much simpler. We look to recent adjacent fields in Wanaea-Cossack, Mutineer-Exeter and Legendre as yardsticks:

• • Wanaea-Cossack – FID taken on 60mmbbls 2P gross;
  • Mutineer-Exeter – FID taken on 61mmbbls 2P gross;
  • Legendre – FID taken on 40mmbbls 2P gross;

• Notably, all took less than 5yrs from appraisal to first oil.

| Euroz Securities declares that it has acted as underwriter to and/or arranged an equity issue in and/or provided corporate advice to Carnarvon Petroleum Ltd during the last year. Euroz Securities has received a fee for these services.

 

[barney]

130 + metres of hydrocarbon pay …. it looks big.

 

[Miner]

I held this for so long and ditched awhile ago when they got Phoenix underway. Welp - should have stuck by them.

Barney
Does anyone know where Agentm is now ?
He used to be a strong poster of many threads including SBR and some oil shares. Do not see his posting for a few years. same with Hangseng - a great supporter of PEN.
By the way, I am not complaining or bragging about CVN. It is the only one on my portfolio has given me 375% return in less than one year. I have bought it a few years ago and sold it. Sold off CVN once it doubled the investment as I was nervous but all of my CVN is at no cost.
I stuffed up on AGO, GID, IRL and few others - those investments are peppercorn value.