Capricorn was drilling on the Bitol 1SON directional stratigraphic new-field wildcat (NFW) in the CNH-R02-L01-A9.CS/2017 PSC contract, Area 9 block during mid-January 2020.     The NFW was spudded on 15 November 2019.  The well has a proposed total depth of 5,305 m      measured depth (MD) and 5,200 m true vertical depth (TVD).   The primary target is the Miocene with secondary      targets in the Pleistocene, Lower Pliocene, and Oligocene on a salt and      fault related structural feature.   The well is being drilled by the âMaersk Developerâ      S/S in a water depth of 163 m.  There is a shallow geological hazard risk and the      operator will first drill a pilot wellbore to log and quantify the risk      that is estimated to be at about 50 m depth. It will then proceed with      drilling the primary wellbore.   The unrisked prospective resources now reported for      the Bitol prospect is 261 MMboe and risked resources are 135 MMboe.   The drilling cost of the Bitol 1SON is estimated to be      USD 53 million and the completion cost estimated to be USD 5 million.  On 24 October 2019, the CNH granted approval for      Capricorn to drill the Bitol 1SON.   Capricorn is operator of the contract and has 50%      working interest, Citla has 35% working interest, and ENI holds 15% working      interest after formal governmental approvals for its farm-in on 19      December 2019.    On 16 May 2019, the CNH approved a modified exploration plan for the Capricorn operated CNH-R02-L01-A9.CS/2017 PSC contract, Area 9 block involving only changes to the drilling schedule of prospects and a change in the proposed budget. From its November 2018 approved exploration plan Capricorn had planned to drill the Bitol-Kukulkan prospect first and the Alom prospect second. This has been changed to drilling the Alom prospect first and the Bitol-Kukulkan prospect second. The second modification in the exploration plan is an increase in the well drilling budget.The total budget approved for the exploration plan is USD 125.85 million. The estimated drilling expenditures for the two commitment wells increased from USD 105.21 million to USD 113.20 million. The Alom prospect is to be drilled first and has an estimated proposed total depth of 3,000 m in a water depth of 140 m. It is targeting stacked, DHI supported Pliocene sandstones starting at 1,550 m. The prospective resources now reported for the Alom prospect is 103 MMboe. The overlapping Bitol and Kukulkan prospects have been merged into one prospect, Bitol-Kukulkan, as reported by the CNH. The NFW will be drilled directionally to an estimated proposed total depth of 5,300 m in a water depth of 180 m.It is targeting stacked Pleistocene, Pliocene, and Upper and Lower Miocene sandstones from 765 m to 3,980 m. The prospective resources now reported for the Bitol-Kukulkan prospect is 261 MMboe. Parent company Cairn contracted the âMaersk Developerâ S/S to drill its commitment wells commencing in 3rd quarter 2019.   On 12 March 2019, Capricorn published a presentation updating its plans to drill two new-field wildcats (NFW) in its operated CNH-R02-L01-A9.CS/2017 PSC contract, Area 9 block during 3rd and 4th quarter 2019.The partners have five scenarios of prospects to drill with the primary prospect now reported to be Alom and Bitol. The operator reported in mid-March 2019 that the Alom prospect, located in the south-eastern corner of the block has 140 MMboe in prospective resources and is targeting a DHI supported Pleistocene stacked reservoirs.The proposed total depth (PTD) for the Alom 1EXP is 3,000 m in an approximate water depth of 140 m. The Bitol 1EXP is a directional new-field wildcat (NFW) prospect located in the south-western area of the block and has a PTD of 5,300 m. The well will target the Miocene in an approximate water depth of 180 m and has 180 MMboe estimated prospective resources  On 27 November 2018, the CNH approved the first budget and exploration plan for the Capricorn operated CNH-R02-L01-A9.CS/2017 PSC contract, Area 9 block from the CNH-R02-L01/2016 Bid Round. The approved exploration plan includes geological and geophysical studies and plans for two firm commitment exploration wells to be drilled in 2019. The total budget approved for the exploration plan is USD 123.18 million. The estimated two commitments well cost is USD 68.18 million. The total work unit commitments proposed is 66,960 work units, above the minimum of 61,100 work units committed to.   On 25 September 2017, the CNH signed the final award contract with the consortium of Capricorn Energy Ltd (Cairn), and Citla Energy E&P S.A.P.I. de C.V. for the CNH-R02-L01-A9.CS/2017 PSC contract, Area 9 block from the CNH-R02-L01/2016 Bid Round. On 19 June 2017, the consortium of Capricorn Energy Ltd (Cairn), and Citla Energy E&P S.A.P.I. de C.V. was the high bidder in the CNH-R02-L01/2016 Bid Round for the Area 9 block in the Sureste Basin and was granted a preliminary award. There was a tie in the bidding for the block between ENI and the consortium of Capricorn and Citla each bidding the maximum of 75% state participation and a 1.5 work unit factor. The Capricorn consortium won the tie-break with a bonus offer of USD 30,003,333.33 versus the ENI offered bonus of USD 20,470,500.00.  The consortium offered 54.9% additional state take participation above the minimum 20.10% for a maximum total state take participation of 75.00%. The minimum work commitments were 2,500 units equivalent to USD 2,500,000 at an oil price between USD 45 to USD 50/bbl. The consortium offered an additional work unit factor of 1.5 equivalent to two wells with a value established by the CNH in the bid documents of 29,300 or USD 29.3 million at an oil price between USD 45 to USD 50/bbl. The total work commitment therefore is estimated to be USD 61.1 million plus the bonus payment of USD 30.0 million is a total financial commitment of USD 91.1 million. There were five other bids for the block. The 3rd highest bidder was the consortium of Chevron, PEMEX, and Inpex who bid total state take of 70.45% and a 1.5 unit work factor.  The general PSC contract terms include a 1st exploration period of four years with the possibility of a two-year extension. Relinquishment of the entire contract area is required if there is no evaluation or development plan filed for any discoveries. There is the possibility of a 2nd exploration period of two years with 50% relinquishment if committing to one exploration well and 0% relinquishment if committing to two exploration wells in the extension period. If a discovery is made there is an evaluation period of two years. The development phase is for approximately 22 years from the date of an approved development plan with two possible five-year extension periods. The maximum contract term is 40 years. Local content during the exploration period is 15%, 17% for the evaluation period, and 26% during the first year of the development period until 2025 when it increases to 35%. A variety of taxes and fees apply to the PSC contract. There is a maximum 60% cost recovery with an adjustment mechanism.
Bitol 1SON (Cairn 50% op, Citla Egy 35%, Eni 15%) in CNH-R02-L01-A9.CS/2017 block, P&A, the objectives were found to be dry, some oil shows were encountered in good quality, water-bearing sst.