World of Oil and Gas
Ion expands East Africa seismic program
Vol. 232 No. 8
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| EXPLORATION | |||
Ion expands East Africa seismic program |
Ion Geophysical has acquired 8,700 km of regional seismic data offshore Tanzania, Mozambique and Comoros, adding to the 14,000 km of data the company previously acquired in the region in the first two phases of its East AfricaSPAN program. This third-phase program comes after several recent large discoveries offshore Mozambique and southern Tanzania have created tremendous interest in the East Africa margin for oil exploration. |
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Forent concludes seismic program in Nova Scotia |
Calgary-based Forent Energy has announced plans to spend upwards of $5 million on developing the Alton block in Nova Scotia after completing its 65-km 2D seismic program in the area. Permitting for the program was initiated in late April with the drilling and recording of data in July. Three drilling locations will be selected after the data is processed and interpreted. |
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Cairn to begin drilling offshore Sri Lanka |
The government of Sri Lanka has approved frontier explorer Cairn’s new plans to drill more wells, at deeper depths, in the Indian Ocean. Cairn filed for a change in drilling plans after reviewing recent 1,750-sq-km 3D seismic data for its 3,000-sq-km block in the Mannar basin. The company will now drill three wells instead of one, using Japanese drillship Chikyu, and has increased the depths to which the exploration wells will be drilled. The drilling activity will begin in August. |
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Norway begins seismic acquisition in eastern sector of Barents Sea |
The Norwegian Petroleum Directorate (NPD) has begun acquisition of seismic data in Norway’s new maritime zone in the Barents Sea, marking the first time this area is being systematically mapped. PGS is conducting the acquisition on behalf of the NPD using the vessel R.V. Harrier Explorer. The 2D acquisition is being captured using a 26,600-ft streamer. |
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TGS, DMNG to start 2D survey in Arctic waters off Russia |
Norway-based TGS will begin acquisition of a new 7,700-km 2D survey in Russian Arctic waters. Data acquisition will begin in early August with 4,500 km in the Laptev Sea before the vessel moves to the East Siberian Sea to acquire an additional 3,200 km. The survey is in partnership with Russian geophysical services company Dalmornefte Geophysica Yuzhno-Sakhalinsk (DMNG). |
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UNCONVENTIONAL |
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Calgory-based independent to drill second Alberta Bakken well |
Bowood Energy has secured a drilling rig that it will move onto its second well in the southern Alberta Bakken fairway. The Kipp 8-30 horizontal well, being drilled by Legacy Oil + Gas, is targeting the Big Valley, Exshaw and Banff formations, which collectively form the Bakken petroleum system in the southern Alberta basin. Bowood and Legacy drilled the first Alberta Bakken fairway well in May and are currently preparing a 20-stage fracture stimulation on it. Drilling on Kipp 8-30 is expected to take six to eight weeks. |
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| First Saskatchewan oil sands leases extended | Oilsands Quest has received approval from the government of Saskatchewan to convert portions of the company’s reservoir testing permit areas at Axe Lake to 15-year leases, which are the first oil sands leases in the Canadian province. The two leases will expire in 2027. In 2008, Oilsands Quest began an extensive testing program at the Axe Lake discovery area to evaluate reservoir response to varying temperatures and pressures of steam with and without solvents. The core samples taken from 16 holes drilled in 2009 have shown the potential for the Axe Lake overburden to contain steam and serve as a cap rock for steam-assisted gravity drainage (SAGD) recovery. The next phase of the program will expand the test sites with horizontal wells, potentially in a typical steam injection configuration. |
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| Beach’s first Australia shale well begins gas flow | Beach Energy reported a gas flow of up to 2 MMcfd from its Holdfast-1 exploratory shale gas well in the Cooper basin, onshore Australia. Holdfast-1, the first well drilled to examine the shale gas potential of the basin’s thick Roseneath-Epsilon-Murteree shale sequence, is a vertical data gathering well that was recently flow stimulated in seven stages. | ||
| CNOOC to acquire Canadian oil sands producer | China National Offshore Oil Corporation (CNOOC) has entered into an agreement to acquire oil sands producer Opti Canada for $2.1 billion. Opti’s total reserves and resources in the Athabasca region of northeastern Alberta are estimated to be sufficient to support about 430,000 bpd (150,000 bpd net to Opti) of bitumen production. | ||
PRODUCTION |
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| Eni sees first oil from GOM Appaloosa field | Eni has started oil production from Appaloosa field, located in the deepwater sector of the US Gulf of Mexico. The well is located 60 miles off the Louisiana coast, within the MC 459 federal unit, which includes blocks MC 459, 460 and portions of MC 503 and 504. It is flowing at a rate of about 7,000 boepd. Operator Eni holds a 100% working interest in Appaloosa, the second field to commence production on the Corral platform, which is processing 46,600 gross boepd. | ||
| Chesapeake surpasses 60 Bcf at Buffalo Creek well | Chesapeake Energy announced a cumulative gross production milestone of 60 Bcf of natural gas from its Buffalo Creek 1-17 well, located in Oklahoma’s Anadarko basin. Chesapeake originally spudded the well in May 2002 and reached a total depth of about 21,000 ft. The well averaged about 41 MMcfd for the first two years of production and is still producing 8 MMcfd.Chesapeake operates the well with an 82.6% working interest and a 65.8% net revenue interest. |
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| Lula flows highest production rates for Petrobras | Petrobras announced that its Lula field producing well has registered the company’s highest volume for May, reaching an average production of 28,436 bopd. This well is the first to produce on a commercial basis in the Santos basin presalt, with five more wells slated to be put online in the future. The consortium developing the field in block BMS-11 is composed of operator Petrobras, with a 65% stake, BG Group, with 25%, and Galp Energia, with 10%. |
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BUSINESS |
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| BP, partners to re-develop Shetland fields for $4.78 billion | BP announced an agreement to progress a major re-development of the Schiehallion and Loyal oil fields to the west of the Shetland Islands, offshore the UK. The two fields have produced nearly 400 million bbl of oil since production started in 1998, and an estimated 450 million bbl of resource is still available. The investment of about $4.78 billion, made primarily by BP, along with Shell, Hess, Statoil, OMV and Murphy Petroleum, will extend the fields’ production to at least 2035. | ||
| ConocoPhillips to split production, refining businesses | ConocoPhillips announced that it will separate its upstream and downstream businesses into two stand-alone, publicly traded corporations. After the split, the upstream segment will trade as an independent E&P company, while the downstream segment will operate as an independent refiner with 2 million boepd of capacity in the US. The separation of the companies is expected to be completed in the first half of 2012. | ||
| BHP Billiton to acquire Petrohawk for $12.1 billion | BHP Billiton has agreed to acquire shale-focused independent Petrohawk for a total equity value of $12.1 billion. The transaction would provide BHP Billiton with operating positions in the Eagle Ford and Haynesville shales, as well as the Permian basin. Petrohawk’s assets cover about 1 million net acres in Texas and Louisiana, with estimated 2011 net production of about 950 MMcfd, or 158,000 boepd. | ||
REGULATORY AFFAIRS |
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| Australia awards six offshore exploration permits | Chevron, Apache and Thailand’s PTT Exploration & Production (PTTEP) are among six companies that have been awarded new offshore oil and gas exploration permits by Australia’s government. Resources and Energy Minister Martin Ferguson estimated that exploration work on the six permits in waters off Western Australia and South Australia states will have a combined value of nearly $148 million over three years, with further investment possible depending on exploration success. Special conditions have been placed on PTTEP, which was responsible for the Montara oil spill offshore northern Australia in 2009. | ||
| Kosmos declares force majeure over rig delay | Kosmos Energy has delivered a force majeure notice to the government of Ghana and the Ghana National Petroleum Corporation because of a delay in the Transocean Marianas semisubmersible’s scheduled arrival around July 10 at the Cedrela-1 well location. The rig, under contract to another operator in Ghana, was rendered temporarily inoperable following a reported anchor-handling incident on the Offshore Cape Three Points block, which is east of the Kosmos-operated Cedrela-1 well location. | ||
| UK raises field allowance for North Sea investment | The UK government announced that the annual rate of the ring fence expenditure supplement (RFES) for the North Sea fiscal regime will be increased from 6% to 10%, following discussions with industry initiated at the 2011 budget hearing. The RFES, which was introduced in 2006, assists companies that do not yet have sufficient taxable income to cover their exploration, appraisal and development costs. The announced increase gives extra support for investment in the North Sea, including in marginal fields that qualify for the current field allowance, and will also support the ongoing considerations on new categories of field allowance. | ||
| Marcellus Shale Advisory Panel issues final report | Pennsylvania Governor Tom Corbett’s Marcellus Shale Advisory Commission has issued its final report, with 96 policy recommendations related to the rapid growth of the local oil and gas industry due to the state’s location in what some are calling the world’s second largest natural gas field. The recommendations range from requiring comprehensive training for emergency response personnel to streamlining permitting processes for construction of gathering pipelines and related infrastructure necessary to speed the product to market. The recommendations are not binding and would have to be implemented through regulations or legislation. | ||
DISCOVERIES |
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| New major gas find in India’s KG basin | Reliance Industries made a gas discovery in the Krishna Godavari basin off the east coast of India with resource potential of 5.2 Tcf, according to license partner Hardy Oil & Gas. The exploratory well KG-D9-A2 in the D9 license reached a 16,000-ft TD and lies in a water depth of about 8,858 ft. The D9 exploration license covers an area of about 2 million acres. Reliance operates the license, holding a 90% interest. UK-based Hardy holds the remaining interest. The basin has yielded several multi-Tcf discoveries over the past decade, including two for Reliance in 2002 and 2009. | ||
| PA Resources finds gas in Danish North Sea | Sweden-based PA Resources discovered a gross hydrocarbon column of at least 750 ft with its Broder Tuck exploratory well offshore Denmark, including 55 ft of net pay in high-quality sandstone. The vertical 5504/20-4 well reached a 12,000-ft TD in layers of Lower Jurassic to Triassic age. A sidetrack will be drilled to assess the potential for additional gas volumes downdip. Broder Tuck lies about 6 miles south of Gorm field in the Danish part of the North Sea. PA Resources operates the license with a 64% interest. Other participants are Nordsøfonden (20%), Danoil (8%) and Spyker Energy (8%). | ||
| Nigerian find prompts search for new export options | Canada’s Mart Resources identified 385 ft of hydrocarbon-bearing sands in UMU-8 well in Umusadege field, onshore Nigeria. The well was drilled to a TD of 8,593 ft. Mart and its partners, Midwestern O&G (operator) and Suntrust Oil, are evaluating new pipeline and export options to provide an alternative for future production capacity. | ||
| Lundin strikes gas in Barents Sea | Swedish independent Lundin made a gas discovery estimated at between 88 and 280 Bcf in the Skalle prospect in the Barents Sea. Drilled with the Transocean Leader semisubmersible, the 7120/2-3S well on Norwegian production license 438 hit a 310-ft gas column in the Cretaceous Kolmule formation, as well as two additional gas columns in Cretaceous and Jurassic reservoirs. The well is situated about 25 km north of the Snøhvit gas field in the southwestern Barents Sea. Logs and cores have been acquired and will be analyzed to determine the appraisal program for the discovery. Lundin operates the license with 25% interest; partners are RWE Dea and Petoro, with 20% each, and Spring Energy and Talisman Energy, with 17.5% each. | ||
| Gas find expands Kulczyk production capacity in Ukraine | Kulczyk Oil Ventures encountered eight potential gas-bearing reservoirs in its third well in Olgovskoye field, in northeastern Ukraine. The exploration company acquired the assets last June when it bought a 70% share in Ukrainian producer KUB-Gas. The O-14 well has been cased to total depth of 9,200 ft, and production testing is expected to commence in late August. The five KUB-Gas licenses are located in the Dnieper-Donets basin and Pripyat graben, which, according to Kulczyk, account for 90% of Ukraine’s oil and gas production. Besides the Ukraine, Kulczyk holds onshore assets in Brunei and Syria. | ||
| Stepout well increases extent of gas discovery onshore Algeria | Petroceltic’s third appraisal well on its Ain Tsila gas discovery in southeastern Algeria logged gas in the main Ordovician reservoir, increasing the proven area of the field considerably to the southeast, according to the company. The field, discovered in 2009 by the Irish independent (operator, 75% interest) and Algerian NOC Sonatrach (25% interest), is located in the onshore Illizi basin. | ||
| Petrobras, OGX confirm discoveries offshore Brazil | Petrobras made three new discoveries of oil and gas in the Espirito Santo basin, 71 miles off the coast of Espirito Santo state, Brazil. The wells are located in waters averaging 6,200 ft deep, within the concession area BM-ES-23 on block ES-M-525. Petrobas said it would forward an evaluation plan to Brazil’s national petroleum agency, ANP, when drilling is completed at the block’s other two wells. Petrobras operates the concession with a 65% interest. Shell holds 20%, and Japanese oil and gas firm Inpex holds 15%. Meanwhile, Brazilian independent OGX identified the presence of hydrocarbons in the BM-S-59 block in the shallow waters of the Santos basin. The OGX-47 well encountered a hydrocarbon column of about 430 ft in sandstone reservoirs of the Santonian section, with about 170 ft of net pay. The well is situated 68 miles off the coast of Rio de Janeiro state in waters 600 ft deep. OGX holds a 100% working interest in the block. |
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