Horizon Oil Limited announced that four WZ12-8E Phase 2 wells in Block 22/12, Beibu Gulf, China, have been successfully drilled, completed and brought onto production. This completes the Phase 2 drilling programme and the Strike drilling rig has now been released from Block 22/12. WZ12-8 East development project: The WZ12-8E development project has been an outstanding success for Horizon and Block 22/12 Joint Venture partners.

The project now comprises ten horizontal production wells that drilled a total of 9,953 m of reservoir plus one water disposal well. Production performance has generally exceeded pre-drill expectations because of a combination of longer horizontal production intervals (achieved average 995m vs planned 920m) and greater offset from the underlying oil-water contact, particularly for the wells in the main Jiaowei field. The success of the Phase 1 drilling programme (A1H to A6H) encouraged the Joint Venture to continue into a four well Phase 2 programme.

The Phase 2 programme included three Jiaowei production wells (A8H,9H,10H) and one development /appraisal well (A11H) into the nearby WZ12-10-1 discovery. Further development of WZ12-8E will be considered in light of the medium to long term performance of the wells drilled to date. To end December 2022 the WZ12-8E project had produced 1.43 mmbbls gross (0.38 mmbbls Horizon net) at an average rate of 5,345 bopd gross (Horizon net 1,440 bopd).

December 2022 WZ12-8E production averaged 9,235 bopd gross (Horizon net 2,489 bopd) with production still increasing as the Phase 2 production wells cleaned-up. The WZ12-8E project is expected to reach a peak oil rate in January 2023 before natural decline begins as formation water production increases. The Joint Venture is investigating various options to mitigate decline including increased liquid rates and increased water handling capacity.

The COSL Strike drilling rig was released on 10 January 2023 after completing operations in Block 22/12. The rig and crew have performed exceptionally with continuous improvement in performance as the programme progressed.