What's new in production

	Vol. 229 No. 2
VICTOR SCHMIDT, DRILLING ENGINEERING EDITOR, schmidtv@worldoil.com

Shale gas

One of the major trends noted in this month’s forecast is the transformation that development drilling for shale gas has had on the US industry. This process has not yet occurred in Canada, where most gas comes from conventional plays.

But that will change in the future. The Alberta Research Council Inc. (ARC), a government-owned, not-for-profit corporation, has partnered with Schlumberger on a research initiative in unconventional gas resource recovery and technology development. According to Ian Potter, vice president of energy at ARC, the Western Canada Sedimentary Basin shales hold from 86 to 1,000 Tcf of gas. As conventional gas reservoirs decline, unconventional gas will be needed to meet market demand. ARC operates five facilities in Alberta serving the energy, life sciences and manufacturing sectors.

The first research program will focus on improving gas production from immature shale reservoirs through rock characterization and non-damaging-fluids fracturing. To overcome the technical challenges, ARC will work with Schlumberger’s TerraTek Geomechanics Laboratory Center of Excellence to address the problems. The oil service firm will also provide field and laboratory operations for shale and coalbed core analysis.

Projects. In the Exmouth sub-basin off Australia’s northwest coast, BHP Billiton began oil production using the FPSO Stybarrow Venture MV16, which reached full production in December after facilities commissioning and reservoir testing. The vessel is in 825 m of water depth in permit WA-255-P (2), 105 mi from Exmouth. The vessel has a 900,000-bbl storage capacity, 100,000-bpd liquid processing capacity, 80,000-bpd crude capacity and 45-MMcfd gas capacity.

Origin Energy (operator with 50%) began drilling production wells from the Kupe platform in the Taranaki Basin off North Island, New Zealand, 30 km out from Ohawe. The Ensco-107 jackup began drilling three 9,850-ft-deep wells, which it should be completed by mid-April. Three additional wells are planned in future years. A 30-km, 300-mm-diameter umbilical carrying power, fiber optics and chemical tubes between the production station and the unmanned platform is being laid and trenched. The project will be onstream by mid-2009. Partners include Genesis Energy (31%), New Zealand Oil & Gas Limited (15%) and Mitsui E&P New Zealand Ltd. (4%).

Total awarded contracts for the Pazflor development in deepwater Block 17, offshore Angola, about 150 km offshore and 40 km northeast of Dalia, in 2,200-4,500-ft water depths. It is Total’s third development center after Girassol and Dalia. The 600 sq km development will bring Perpetua, Hortensia, Zinia and Acacia fields into production. Drilling operations will begin in 2009 with oil production starting in 2011.

BP began exporting oil and gas from the recently commissioned Atlantis semisubmersible platform in the Green Canyon area of the deepwater Gulf of Mexico. The platform is 150 mi south of New Orleans in 7,070 ft of water. Production started in October 2007, but with gas facilities and export pipelines now operational, gas sales have begun and oil volumes are increasing. More wells are coming onstream, and the facility will reach full production by the end of 2008.

Stratic Energy Corp. submitted a field development program for the West Don oil field in the UK North Sea, which is expected to be approved by midyear. The field will be developed in tandem with Don Southwest Field, using a re-furbished vessel, Northern Producer. West Don Field is on Blocks 211/13 and 211/18a, 150 km northeast of the Shetland Islands in 500 ft of water depth. Petrofac Energy Developments Ltd. will operate the unitized properties.

New output. OAO Gazprom began production at Yuzhno-Russkoye gas field, Russia. The field will be the gas source for the Nord Stream pipeline project to Europe. Gazprom will ramp up production to 883 Bcf per year of gas by 2010 and estimates the field contains 28.2 Tcf of gas.

BP started producing gas from Cashima Field, offshore Trinidad. The Cashima development includes Cashima and North East Queens Beach Fields. Both are in the South East Galeota Block in 270-ft water depths, 45 mi east of Galeota Point. The fields were developed using a single unmanned platform that can produce from nine wells. The fields will produce 750 MMcfd of gas plus condensate to LNG plants.

CNOOC Ltd. brought two new Bohai Bay fields online. Jin Zhou (JZ) 21-1 Field is producing 3.53 MMcfd of natural gas from one well and Bo Zhong (BZ) 34-1 Field is producing 4,800 bopd from seven wells. JZ 21-1’s peak production is 11 MMcfd from three wells and 1,000 bopd from two wells. BZ 34-1 is scheduled for more than 20 producing wells with peak production of 12,000 bopd.

Esso Exploration Angola Ltd. started Kizomba C production, offshore Angola. The development is in Block 15 in 2,400 ft of water depth more than 90 mi off the coast. It uses two FPSOs and 36 subsea wells to produce and gather oil from Mondo, Saxi and Batuque Fields. Production began with Mondo Field, which will reach 100,000 bopd. Full output will be 200,000 bopd after Saxi and Batuque Fields come onstream later this year.

Galoc Field, 65 km off Palawan province in the Philippines, will return to production this month, according to Nido Petroleum. The field produced 5,000 bopd between 1981 and 1988, but was never developed due to high costs. The country’s energy department expects the field to increase annual crude oil output by almost 500,000 bbl.

Shell began gas production from Starling Field in the UK North Sea. At its peak, production will be 140 MMcfd. Shell is operator with 28% and has ExxonMobil as a partner with 72%.

Talisman North Sea Ltd. started production from Wood Field, 130 mi east of Aberdeen in the UK North Sea. The field will produce 6,000 bopd and 16 MMcfd. Talisman North Sea Ltd. is the operator with 58.97%, with Energy North Sea Ltd. as partner with 41.03%.

ConocoPhillips and Total E&P Canada began production of their Surmont project, 60 km southeast of Fort McMurray in Alberta, Canada. Phase One of the SAGD project will produce 25,000 bpd of oil. ConocoPhillips is operator of the 50-50 joint venture.

Tethys Petroleum began gas production from Kyzyloi Field in Kazakhstan. Initial volumes are 21.2 MMcfd of natural gas from six wells, which will rise to 22.1 MMcfd of gas by March.