AUSTRALIAN headquartered Melbana Energy is a stock to watch this year as prepares to spud two high-impact oil exploration wells in Cuba.
Melbana Energy (ASX:MAY) is an oil and gas explorer with more than 20 years' experience led by some of the most well-known experts in the business.
While many ASX listed explorers chase small to mid-sized prospects domestically, Melbana Energy's mantra is, go big or go home.
It chases elephant-sized prospects and will drill two wells in Cuba this year targeting billions of barrels of oil at its Block 9 project.
Melbana Energy appointed experienced drilling contractor Sherritt International in March, with a view to spud its first well, Alameda-1, in the coming months.
Alameda-1 is a conventional stacked play targeting a three structures; the primary Alameda prospect, the shallower N structure as well as the Amistad prospect.
Combined these three structures could hold 141 million barrels of oil on a best estimate resource basis.
The second well, called Zapato-1 is in close proximity to the high quality Motembo oil field which is potentially even bigger than the three stacked plays at Alameda-1.
Zapato is estimated to hold as much as 95 million barrels of crude on a best estimate basis, however on a high estimate could host as much as 214 million barrels.
Existing oil fields near Melbana Energy's project yielded as much as 11 billion barrels of oil historically, offering further excitement around the two-well campaign.
At current benchmark oil prices, if the wells come up productive, Melbana Energy will move from being an explorer to a producer.
In fact, it has also struck an agreement with the government of Cuba to sell the oil to them at benchmark global oil prices or the international market.
So, why Cuba? Melbana Energy executive chairman Andrew Purcell sums it up nicely.
"Try replicating projects of our size in Australia."
In this podcast, Energy News senior journalist Paul Hunt talks to Melbana Energy executive chairman Andrew Purcell about the future of a potential discovery, what an initial development could look like, and the current state of the energy market.