What's new in production

	Vol. 229 No. 6
VICTOR SCHMIDT, DRILLING ENGINEERING EDITOR, schmidtv@worldoil.com

Resource plays

Most everyone has heard of the three most important unconventional shale plays in the US: the Barnett Shale in Texas, Fayetteville Shale in Arkansas and Marcellus Shale, which stretches from Kentucky northeast across West Virginia and up into New York state. But there are many other shales that are being opened as new resource plays. Some of these less well-known plays include the Woodford Shale in Arkansas and western Oklahoma, Lower Huron Shales in the Appalachian Mountain states and the Haynesville Shale in Louisiana.

New trends are opening in Oklahoma’s Anadarko Basin, including the Colony Granite Wash in Washita and Custer Counties. It has been tested and found productive with wells yielding good gas flows. Chesapeake Energy now has 12 wells producing 40 MMcfd (net). In southwestern Oklahoma and the Texas Panhandle, the Mountain Front Granite Wash is being drilled along the 150-mi Mountain Front region. Significant leasehold acres have been gathered by independents seeking to develop these plays.

In Tennessee, the Chattanooga Shale is a shallow gas play on the Cumberland Plateau with drilling depths of 1,500 to 2,000 ft. It is well within the drilling capabilities of smaller independent companies, which are taking acreage positions in the trend. The new shale-gas play could hold up to 5 Tcf of recoverable natural gas and could be developed over 6,000 mi2.

Other parts of the world are being examined for their resource play potential. MOL Nyrt, a Hungarian oil and gas company, and Exxon Mobil Corp. are 50/50 partners in a $75 million project to recover unconventional gas in the Makko Trough in southern Hungary. MOL estimates production costs at $2-$3/boe, excluding capital costs. A 30% recovery rate is expected and commercial viability may take four years to resolve. Watch for more plays to open as companies seek this new reservoir type across the globe.

Joint production?

China and Japan are moving closer to joint production of present and undiscovered fields near their disputed marine boundary. According to diplomatic sources, China is now willing to consider including the disputed East China Sea field Chunxiao (known as Shirakaba in Japan) for joint development.

The field is west of the median line that forms Japan’s 200-nautical-mi Exclusive Economic Zone (EEZ). China claims its EEZ stretches further west than the Japanese line, reaching closer to Japan at the edge of the continental shelf. China is producing oil from Chunxiao Field.

Projects

Eon Ruhrgas and partners approved Babbage Field development in the UK’s southern North Sea. Three wells will be developed with an option to drill two more wells on a new platform. Formal approval from the secretary of state is needed to develop the gas field. Production will be piped to West Sole and then on to Dimlington terminal at Humberside. First gas will flow in 2010. Eon Ruhrgas is operator with 47%; Dana Petroleum has 40% and Centrica Resources holds 13%.

Elsewhere in northern waters, the Morvin Field Plan for Development and Operation was approved by Norway’s Council of State and calls for an NOK 8.7 billion investment. The field is in the Norwegian Sea, some 9 mi (15 km) northwest of Asgard. The development will tie back two subsea templates to the Asgard B platform for processing, using a 12-mi (20-km) pipeline. StatoilHydro will begin constructing subsea templates and flowlines this summer with first oil projected for 2010. The field is expected to produce 27,000 boepd. StatoilHydro is operator with 64% along with partners Eni (30%) and Total (6%).

New output

The Deep Water Gunashli (DWG) platform complex began producing oil in the Caspian Sea offshore Azerbaijan, according to Azerbaijan International Operating Co. (AIOC). DWG will produce 320,000 bopd, bringing ACG oil production to over 1 million bopd. The platform complex is in 574-ft water depth (175 m) on the eastern side of Gunashli Field. It includes two platforms: a gas compression and water injection platform linked to a drilling and production platform. BP is operator with 34.1% along with partners Chevron at 10.2%, SOCAR with 10%, INPEX at 10%, StatoilHydro holding 8.6%, ExxonMobil with 8%, TPAO at 6.8%, Devon with 5.6%, ITOCHU at 3.9% and Hess holding 2.7%.

Saudi Aramco started producing oil from Khursaniyah Field in Saudi Arabia. The field will be pumping 300,000 bpd by June, according to the company, and the field’s production capacity is as much as 500,000 bpd.

Total E&P Congo began producing oil from Moho-Bilondo Field about 80 km offshore the Republic of Congo in 1,770-2,396 ft of water. The field is estimated to hold some 230 million bbl of oil. Two subsea clusters with nine producers and five injectors will produce 90,000 bopd. Total E&P Congo is operator with 53.5% along with partners Chevron Overseas Congo Ltd. at 31.5% and Societe Nationale des Petroles du Congo with 15%.

StatoilHydro started producing from Gamma Main Statfjord in Oseberg Field in the North Sea. This fast-track development is in the Statfjord Formation beneath the western flank of Oseberg Field, where a 275-ft (84-m) oil column was discovered. The well will produce 13,000 bopd and be supported by an injector well, which is being drilled. Additional small deposits are scheduled to come onstream over the next year.

Also in the North Sea, Shell UK and Esso began gas production from Caravel Field, 94 mi (115 km) off the UK coast. The field was developed with a wind- and solar-powered Monotower platform design developed by Shell. Gas production is estimated to be about 100 MMcfd with 3,000 bpd of condensate once the field stabilizes. Shell is operator with 71% and Esso holds 29% interest.

Kirthar Joint Venture began producing gas from Badhra Field in the Sindh province of Pakistan. The field is 154 mi (250 km) northeast of Karachi and southeast of Bhit Field. The gas production will be processed at the Bhit gas treatment plant, which was recently expanded. The Kirthar Joint Venture includes Eni Pakistan Ltd. (operator) with 40%, Kirthar Pakistan B.V. at 28%, Oil & Gas Development Co. Ltd. with 20%, PKP Kirthar 2 B.V. with 6% and PKP Kirthar B.V. holding 6%.