HIGHLIGHTS
Cuba
Block 9 PSC (Melbana 30% participating interest and Operator)
- Initial development of Unit 1B on track.
- All materials for Alameda-2 workover in country, workover on track for early February.
- Drilling rig to mobilise to Amistad-2 location immediately thereafter.
- Melbana subsidiary approved as Operator in Cuba.
- Oil offtake contract terms being finalised with an international oil trader.
- Pre-bid seismic scouting process completed.
Corporate
- $9.7 million cash available at the end of the quarter.
Melbana Energy Limited (ASX: MAY) (Melbana or the Company) provides the following summary in
relation to its activities during the quarter ended 31 December 2024.
CUBA: Block 9 PSC (Melbana 30%, Operator)
Field development
As announced at the AGM, the first
phase of the field development plan will
be a workover of the existing Alameda-2
completion within the Amistad Unit 1B
reservoir (see Figure 2 below) followed
by the drilling of a number of production
wells into Unit 1B reservoir within the
Amistad Structure, the first being the
Amistad-2 well.
Using existing 2D seismic control,
Amistad-2 will be drilled to the South
from Pad #9 targeting the highest
confidence (1C) resource of 16 million
barrels1
, in a location up-dip of Alameda2.
Future 3D seismic will allow development wells to be accurately positioned to more efficiently develop
and potentially extend the recoverable 2C Contingent Resource of 46 million barrels1 .
A pre-bid seismic scouting process was completed with contractors during the December quarter,
data from which will be incorporated into the survey design.
The near-term goal to export a first cargo remains a priority.
Alameda-2 Workover
The workover of Alameda-2 is planned to commence in early February 2025. The program is designed
to remediate interpreted near-well formation damage identified in the Amistad Unit-1B oil reservoir.
The nature of this damage was determined by our in-house team and external experts analysing
results from the original Drill Stem Test (DST) and subsequent Extended Production Testing.
2
Key steps in the workover program include using a service rig to pull the completion, add perforation
intervals in the upper and lower Unit 1B and undertake an acid wash and squeeze before re-running
the completion.
Drilling additional well into Unit 1B
Preparations for the drilling of Amistad-2 are well advanced and an outline drilling program was
compiled during the quarter. The drilling program incorporates all lessons learned to date in order to
maximise the well’s flow potential. Amistad-2 is to be drilled from Pad #9 in a southerly direction,
along the existing 2D seismic line, and is designed to intersect the entire Unit-1B pay interval and
numerous interpreted fracture sets (Figure 2 below). The surface location is approximately 800m
from and 200m updip to the successful Alameda-2 well.
Following the observation of formation damage during extended production testing of Alameda-2, and
subsequent likely formation damage in Alameda-3, the Company decided to investigate alternate
drilling fluid systems. Preliminary investigations led Melbana to develop a Reservoir Drilling Fluid
(RDF) for the Alameda field.
The use of RDF is relatively common for formations susceptible to drilling induced damage.
Melbana’s RDF is a water-based drilling fluid that is designed to minimise the risk of formation
damage, whilst maintaining the ability to safely and effectively drill the well.
During the quarter, scanning electron microscope images of Alameda-3 core samples were received,
providing direct indications of formation damage including barite embedment and crystalline
precipitates within pores and fractures of core plugs. This information was incorporated into the
extensive chemical analysis and final design of the RDF and associated fluid and rock compatibility
testing, which confirms its suitability for the Unit-1B reservoir.
Given the dedicated Unit-1B target for Amistad-2, it has been possible to significantly simplify the well
design. As such, it is expected that the well will be completed open-hole, with 7” slotted liner available
as a contingency, an application which works well with the proposed RDF. The completion tubing will
then be run before a pre-production acid-wash being circulated and the well then brought immediately
into production without the need to kill the well.
Drilling is planned to commence immediately after the workover of Alameda-2.
Commercialisation
A significant component of Melbana’s commercialisation plans were realised when Melbana’s
subsidiary was approved as an operator in Cuba.
Melbana’s engineering and commercial teams continue to progress plans for the export of oil
produced from Block 9. The preferred plan is to truck crude to receiving pits connected to oil storage
tanks at the nearby oil storage terminal before export from the port. Crude exports are expected to
continue to be pursued to underpin the Company’s long-term ambitions for the project.
The Company continued its discussions with several potential new partners and credit providers who
have demonstrated interest in participating in the development of Block 9.
AUSTRALIA
Hudson Prospect in NT/P87 and WA-544-P (Melbana 100%)
Melbana holds 100% of WA-544-
P & NT-P87 exploration permits
containing Carbonate Platform
opportunities (see Figure 3).
Melbana continued the process of
identifying a farminee(s) to fund a
forward work programme (3D
seismic survey and contingent
drilling option) in the permits. WA544-P and NT/P87 hold similar
resource potential as the adjacent
WA-488-P exploration permit, that
contains the Beehive drilling
prospect, and which is likely to be
drilled by the Operator of that
exploration permit in 2025.
AC/P70 Timor Sea (Melbana 100%)
Melbana holds 100% of the AC/P70 exploration permit (see Figure 4). Interpretation and mapping of
the reprocessed 500 km2 Pantheon 3D survey progressed during the quarter. Once complete the
Company will commence a farmout process.
HEALTH AND SAFETY
No lost time incidents occurred during the reporting period.
CORPORATE
Payments to related parties and their associates, totalling $230,000 as outlined in Section 6 of the
accompanying Appendix 5B, related to payment of directors’ fees.
The Company had total cash on hand of $9.7 million as of 31 December 2024.