Melrose Resources has hit pay in its Kavarna No.1 exploration well, 7km to the east of its Galata gas field in the Black Sea offshore Bulgaria.

The well was drilled to total depth of 2,899ft (884m) and encountered the top of the Palaeocene reservoir target at a depth of 2,628ft (801m).

The mud log obtained while drilling established that the reservoir formation was well developed and gas-bearing and initial reserves estimate for the discovery are 24 Bcf (670 MMcm) of gas.

Following the completion of operations on Kavarna, the Prometeu rig will be used to perform an extended well test on the GE3-Kaliakra No.1 discovery well announced earlier this year.

The Kaliakra discovery is located around 15km to the east of the Galata field and is estimated to contain reserves of up to 47 Bcf (1.33 Bcm).

Kaliakra is being developed using a subsea tieback to the Galata platform, with first gas production scheduled for the third quarter of 2009.

Plans are also now being formulated for the development of the Kavarna discovery and first production is expected in 2010, Melrose said.