Karoon Gas faces setback as Brazil well doesn't yield oil

3/24/2013

Karoon Gas faces setback as Brazil well doesn't yield oil

BY ROSS KELLY

SYDNEY -- Karoon Gas faced a setback to its exploration offshore Brazil after a well in the Santos basin didn't unearth any significant oil reserves.

Despite early signs of oil in the Emu-1 well, drilled to a depth of 4,381 m in a joint venture (JV) with Pacific Rubiales, further testing indicated its main reservoirs contained water instead of oil, Karoon said in a statement.

"There is evidence that there may be some thin sand sections that may contain hydrocarbons and analysis of these sands is continuing" Karoon said.

Emu-1 is the second well in the Brazilian exploration campaign. The first, Kangaroo-1, discovered oil and Karoon wants to drill another well, Kangaroo-2, nearby to assess that discovery. The JV also plans to drill another well, Bilby-1, in the Santos basin later this year.

Dow Jones Newswires

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