World of Oil and Gas

Vol. 234 No. 6

Gas condensate discovered in deepwater offshore India

Reliance Industries Limited (RIL), and its partners BP and NIKO, made a significant gas and condensate discovery in the KG D6 block off the eastern coast of India. The KGD6-MJ1 well was drilled in a water depth of 1,024 m, and to a TD of 4,509 m, to explore the prospectivity of a Mesozoic Synrift Clastic reservoir more than 2,000 m below the already-producing reservoirs in the D1-D3 gas fields. Formation evaluation indicates a gross gas and condensate column in the well of roughly 155 m in the Mesozoic reservoirs. In the drillstem test, the well flowed at 30.6 MMcfd, with a liquid rate of 2,121 bopd, and a choke of 36/64 in with a flowing bottomhole pressure of 8,461 psia, suggesting good flow potential. The discovery, named “D-55,” has been declared to the Government of India and the management committee of the block. This discovery is expected to add to the hydrocarbon resources in the KG D6 Block. Appraisal will now commence, to better define the scale and quality of the field. RIL is the operator of KG D6, with 60% equity. BP has a 30% share, and NIKO the remaining 10%.

Noble Energy hits Karish discovery offshore Israel

Noble Energy struck a natural gas discovery at the Karish prospect offshore Israel. The discovery well was drilled to a TD of 15,783 ft, and encountered 184 ft of net natural gas pay in high-quality lower Miocene sands. The Karish well, in the Alon C license approximately 20 mi northeast of Tamar field, is in 5,700 ft of water. Discovered gross resources, combined with the de-risked resources in an adjacent fault block on the license, are estimated to range between 1.6 and 2.0 Tcf, with a gross mean of 1.8 Tcf, based on 75th and 25th percentile probabilities. Karish is the fifth discovered field, with an estimated gross mean resource size over 1 Tcf, and the seventh consecutive field discovery for Noble Energy and its partners in the Levant basin. The Ensco 5006 will relocate from the Karish well to Cyprus, where it will spud an appraisal well at the Cyprus A discovery.

Petrobras finds quality oil in Entorno de Iara

Petrobras discovered good-quality oil in the Transfer of Rights area, referred to as Entorno de Iara, in the Santos basin pre-salt region. Well 1-BRSA-1146-RJS (1-RJS-711), known as Entorno de Iara 1, is in a water depth of 2,266 m, 235 km off the coast of Rio de Janeiro state. The discovery was confirmed through wire test samples of good-quality oil (26° API), collected from carbonate reservoirs of excellent quality, just below the salt layer, at a depth of 5,045 m. The well was completed at a depth of 5,580 m. A formation test and the drilling of another well are scheduled in the area, to evaluate the productivity of the reservoirs.

Far East Energy appraisals succeed in Shouyang Block

After completing drilling on appraisal well SYS-03, Far East Energy Corporation said preliminary results from the testing of seven core samples indicate gas content for the No. 15 coal seam of more than 800 standard cubic feet per ton (scf/t). The well reached a TD of 4,826 ft, and revealed a total coal seam thickness of approximately 12.4 ft. SYS-03 is in the east-to-southeastern portion of the Shouyang Block. Gas content estimates for SYS-03 are similar, the company said, to the estimates for nearby well SYS-05, which has an approximate gas content of more than 900 scf/t. The results from the testing of core samples from Far East’s SYE-06 appraisal well indicate an initial gas content of 592 scf/t in the No. 15 coal seam. Additionally, production wells 115V and 119V have reached TD, while appraisal well SYE-16 and production well 62-2V have both been spudded. This activity brings the total number of Far East wells spudded in 2013 to 23, 16 of which are ready for fracture stimulation.

Dr. Ernest Moniz confirmed as U.S. Secretary of Energy

Dr. Ernest Moniz was sworn in as the 13th Secretary of Energy, by Deputy Energy Secretary Daniel Poneman, in a ceremony on May 21, 2013. He was confirmed by the full Senate, in a 97-0 vote, on May 16. Prior to his appointment, Moniz was the Cecil and Ida Green Professor of Physics and Engineering Systems at the Massachusetts Institute of Technology (MIT), where he was a faculty member since 1973. Most recently, Moniz served as the founding director of the MIT Energy Initiative and of the MIT Laboratory for Energy and the Environment, and was a leader of multidisciplinary technology and policy studies on the future of nuclear power, coal, nuclear fuel cycles, natural gas and solar energy in a low-carbon world.

The U.S. Department of Energy has approved Freeport LNG Expansion LP and FLNG Liquefaction LLC as an exporter of domestic LNG to countries without a free trade agreement (FTA) with the U.S. A host of companies have permission to export LNG to countries with FTAs, but Freeport joins Cheniere Energy Inc.’s Sabine Pass project as being able to do so to non-FTA countries, which include some of the largest LNG importers in Asia and Europe. Freeport’s facility is still subject to an environmental review and final approval, but it has been authorized to export up to 1.4 Bcfd for the next 20 years. Sabine Pass is authorized to export 2.2 Bcfd. LNG export plants face several regulatory hurdles, and have encountered stiff opposition in the U.S. from manufacturers that say exports will cause domestic natural gas prices to skyrocket.

The 11th round for oil and gas exploration blocks, held May 14 by Brazil’s ANP in Rio de Janeiro, received $1.4 billion in bids for exploration rights. The 797.81% premium achieved over the auction’s starting price is also record-breaking, as is the $3.45-billion forecast for investments to be made by the winning companies under the Minimum Exploration Program. In all, 100,300 sq km, of the 155,800 sq km of exploration area offered for bids, were successfully auctioned, with 39 companies from 12 countries participating in the auctions. Thirty bidders won, including 12 Brazilian and 18 foreign companies from Australia, Bermuda, Canada, Colombia, Spain, the U.S., France, Guernsey (UK), Norway, Portugal and the UK. The 142 blocks successfully auctioned are in 11 Brazilian states, covering 11 sedimentary basins. The largest concession auctioned, with a winning bid of $172.9 million, was offered for Block FZA-M-57 (Foz do Amazonas Basin) by Total E&P Brasil.

PDVSA and Chevron signed a $2-billion loan that will go to raise production at the companies’ Petroboscan joint venture in Venezuela, in which Chevron holds a 39.2% interest. Chevron, which is lending the money, will be repaid at a rate of 4.5% points over the London interbank offered rate, Oil Minister Rafael Ramirez said at a signing ceremony, with Chevron’s head of Latin American and African operations, Ali Moshiri. The loan will allow Petroboscan, which runs the Boscan field in Venezuela’s western state of Zulia, to boost output from 107 Mbpd to 127 Mbpd, over the next few years. During 2012, net daily production averaged 28,000 bbl of liquids, and 5 MMcf of natural gas. The two sides negotiated the loan over a two-year span.

Next Generation Corp. will acquire a natural gas and oil lease for a 134-acre parcel in Mason County, W.Va., increasing its portfolio of energy producing properties to 2,154 acres in the Appalachian region, in addition to its West Texas and Louisiana royalty holdings. The large parcel, in southeastern Mason County, is located in a prolific natural gas region of southwestern West Virginia.

Southwestern Energy acquires Marcellus shale properties

Southwestern Energy Company has closed its acquisition of approximately 162,000 net acres in the Marcellus shale in Pennsylvania. The properties were acquired from Chesapeake Energy Corporation and its partner for approximately $93 million, excluding purchase price adjustments. Southwestern has financed the acquisition with its revolving credit facility. Southwestern is an independent energy company whose wholly-owned subsidiaries are engaged in oil and gas E&P, natural gas gathering and marketing.

Otto Energy embraces KUFPEC in Galoc JV

Otto Energy Limited has announced that Kuwait Foreign Petroleum Exploration Company (KUFPEC) has become a partner in the Galoc joint venture. KUFPEC has assumed control of a 26.84% working interest in the Galoc joint venture, following the acquisition of Risco Energy Pte Ltd., the ultimate parent of Galoc Production Company No. 2 Pte Ltd. Otto continues to hold a 33% working interest in, and remains operator of, the Galoc project. The Galoc JV partners last year approved the Galoc Phase II development, which is due to commence drilling in June 2013, with first oil expected in the fourth quarter of 2013. KUFPEC joins the Galoc JV during a critical period of investment that will extend production from Galoc beyond 2020.

Qatar seals deal with Total

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