Archive  April 1999 Vol. 220 No. 4  International

Kurt S. Abraham,  International Editor

Kuwait acknowledges sweet crude strike

Kuwaiti authorities have confirmed the existence of a new field containing low-sulfur crude oil, after good results were obtained in a recent appraisal well. Named Kra al-Marow, the field is in the northwestern half of the country (see map). Initial reports in local newspapers Arab Times and al-Seyassah quoted Kuwaiti Oil Minister Sheikh Saud al-Sabah as saying that "huge underground reserves of light sweet crude oil" were discovered, "equal to those at Burgan field."

However, most impartial observers doubt that statement’s accuracy, given that the greater Burgan complex contains roughly 70 billion bbl of proven oil reserves. Burgan is the world’s second-largest oil field behind Saudi Arabia’s Ghawar complex. Indeed, Kuwait Oil Co. was considerably more low-key in its own statement, released a day after the newspaper accounts. "Results of drilling (the) Kra al-Marow 2 proved the existence of quantities of light, high-quality crude oil," said KOC. "Primary results were encouraging."

KOC went on to say that average production from that well is about 1,800 bopd. It follows drilling of the discovery well in 1995. As for development plans, the company would only say that the field’s productive capability would be evaluated over a four-to-six-month period.

Y2k bug may bite Arab states. A United Nations official is worried that most of the Arabic countries in the Middle East are poorly prepared for the millennium computer bug, whereby some software cannot roll over to the year 2000. Mohammed Mrayati, science and technology advisor to the U.N.’s Economic and Social Commission for Western Asia (ESCWA), told the Reuters news service that few nations in the region have paid attention to the problem until just recently, much less draw up plans to solve it.

"The Middle East is particularly at risk, because normally, our governments do not come up with contingency plans," said Mrayati. "If things break down, then the action is usually spur-of-the-moment, unorganized and takes time. But if this happens in certain (operations), the results could be catastrophic." If some countries do not step up their efforts in time to solve the two-digit date problem by the end of 1999, he predicts that casualties could include oil production and refinery operations, water desalination plants, electricity networks and the Suez Canal.

Canadian update. It never fails — as soon as we compile and publish survey data in our February issue, some company or government will invariably send us information a month late. Often, the difference the data makes in our forecast is not sufficient to warrant mention.

However, as regards our recent survey of Canadian operators, an exception is in order. One large company, who shall remain nameless, waited to send its drilling data until our February issue was in the mail. Nevertheless, this firm’s numbers deserve mention, because they overwhelmingly reinforce the drilling increase that our sample group of companies is planning. The new Canadian totals are:

Given that we predict 9,950 wells will be drilled in Canada this year, the new survey group total theoretically accounts for nearly half of all Canadian activity, as well as better than a third of last year’s estimated total. Addition of the latest firm’s data does not significantly increase the magnitude of increase that our survey group plans. Before this addition, they collectively expected a 21.8% increase. Now, that figure is 22.7%. However, gas drilling is now slated to rise 33% among this group, to 2,727 wells.

Petrobrás’ chief quits. After a six-year run, Joel Renno resigned last month as president of Brazil’s state oil company. Renno explained that he felt his job was done, that he had finished modernizing Petrobrás’ operations and adequately prepared the firm for competition in Brazil’s liberalized oil sector. Nevertheless, critics at some foreign oil companies insisted that Renno’s regime had actually held Petrobrás back from progressing even further.

Whatever the case, Renno’s departure is believed to signal the long-awaited sale of Petrobrás to private interests. That sale, if it comes, will be handled by Renno’s successor, Jose Coutinho Barbosa. Selected to "temporarily" fill the presidency, Barbosa is the former head of Petrobrás’ international subsidiary, Braspetro. He was selected by Mines and Energy Minister Rodolfo Tourinho.

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Copyright © 1999 Gulf Publishing Company