Australian junior Oilex has seen its stock jump after it emerged that flows from its Cambay project onshore India had beaten volume predictions and contained more liquids than expected.
The Perth-based company said that controlled flow-back of frac fluids from the Cambay 77H well had yielded 50 degrees API light crude oil in addition to the gas and condensate that had been expected to flow from the Eocene tight gas formation.
The explorer’s shares were trading up 40% at around £0.09 on London’s Alternative Investments Market by Monday afternoon following the announcement.
Oilex managing director Ron Miller said that the Gujarat province probe “is exhibiting all of the signs of a high-performance well”.
“The recovery of light oil/condensate with the gas under clean-up flow this early in the flow-back phase is considered positive and the hydrocarbon liquid volume exceeded our expectations,” he added.
Flowback is expected to take two to three weeks after which production test will determine a stable flow rate for the probe.
London-based analysts RFC Ambrian said that “the well is cleaning up in a fashion that suggests it is likely to prove to be a commercial well”, particularly given its higher than expected liquid production.
It cautioned that the reservoir’s deliverability and the quality of the eight fracture stimulations would not be known until the results of the upcoming flow test.