Melbana Energy (ASX: MAY) appears to have overcome formation issues that have hampered development plans at its Block 9 operation in Cuba.

Melbana’s share price was up more than 35% in Tuesday morning trade after it reported that a successful workover of the Unit 1B reservoir within the Block 9 operations onshore Cuba had delivered a significant production rate increase.

The company said its strategy to overcome formation damage issues has seen production levels jump from 293 to 488 barrels of oil per day (BOPD), putting it back on track to begin its first oil shipments.

Maiden oil shipments

Melbana, which owns 30% of Block 9 and operates it with Angolan state-owned oil company Sonangol, is now focused on building its oil inventory in the lead-up to its maiden shipment.

“The workover has delivered a 66% increase in the production rate and given us a lot of new data to analyse about how to maximise production from this reservoir,” executive chair Andrew Purcell said.

“Unit 1B has shown it can produce at 1,235BOPD from an appraisal well—we are looking forward to seeing what it can do through a dedicated production well that has had everything we’ve learned to date incorporated into its design.”

Formation damage

A major investigation into the previous rapid declines in production at Block 9 had identified the impact of the completion fluid initially used as the most likely cause of the formation damage .

Analysis of logs, cores and other data from the Alameda-3 appraisal suggested that the fluids used to shut in the well may have damaged the formation near the well bore.

The operators designed a workover program to try and repair this damage using the results from studies examining the interaction of various fluid types and compositions with formation samples taken from Unit 1B.

Further stimulation

Melbana is confident the lessons learned from this workover can be utilised with further stimulation during any future well intervention and directly applicable to any such future work.

The company’s studies have also indicated that near-wellbore damage may have been responsible for the Alameda-3 results, which is now also a candidate for future remediation.

Melbana has turned its focus to the upcoming drilling of the Amistad-2 production well and said preparations for the program are on schedule.

The company expects civil construction to be completed in April.