World of oil and gas

Petro River discovers Arsaga field, its largest find to date

After successfully drilling the Arsaga 25-2 exploration well, Petro River Oil Corp. announced the discovery of its largest oil field to date. The well, situated in Osage County, Okla., was the first of three exploration wells to be drilled under the company’s 2018 drilling program. It was spudded in early July, reaching a depth of approximately 2,750 ft. Preliminary results showed about 30 ft of productive Mississippian Chat formation, which led to an estimated ultimate recovery of about 50,655 boed. “The discovery in the Arsaga field has given the company continued confidence in our ability to effectively use 3D seismic imaging technology to discover overlooked prospects. The development of the Arsaga field, with approximately 2,000 prospective acres and up to 100 well locations, will be the focus of our activity for the next couple of years,” Petro River President Stephen Brunner said in a release.

Exxon increases resource estimate for Guyana’s Stabroek Block

ExxonMobil Corp. increased its estimate of discovered recoverable resources for the Stabroek Block, offshore Guyana. Following completion of testing at the Liza-5 appraisal well; the Ranger discovery; incorporation of the eighth discovery, Longtail, into the Turbot area evaluation; and completion of the Pacora discovery evaluation; the company revised its resource estimate for the block, from 3.2 Bboe to 4 Bboe. The Liza-5 well tested the northern part of Liza field, and will support a third phase of development in Guyana, alongside the giant Payara field. Likewise, the Longtail well established the Turbot-Longtail area as a potential development hub for recovery of more than 500 MMboe. Drilling of additional prospects in the area reportedly could further increase that estimate. According to the company, discoveries within the 6.6-million-acre Stabroek Block have established the potential for up to five FPSOs, producing over 750,000 bopd by 2025. Exxon’s affiliate, Esso E&P Guyana Limited, is operator of the block, with a 45% interest. Its partners include Hess Guyana Exploration Ltd. (30%) and CNOOC Nexen Petroleum Guyana Limited (25%).

Eni reports its second discovery in Egypt’s Faghur basin

After drilling its second well to explore the deep geological sequences of the Faghur basin, Eni reported another light oil discovery in the Western Desert’s South West Meleiha License, approximately 80 north of Siwa. SWM B1-X was drilled to a TD of about 14,839 ft, approximately 4 mi from the first find, and encountered nearly 115 ft, net, of light oil in the Paleozoic sandstones of the Dessouky formation, of Carboniferous age, and in the Alam El Bueib sandstones, of Cretaceous age. The company says that it plans to drill several other prospects nearby, in the hopes of uncovering more resources and opening up a new productive area for Eni. International Egyptian Oil Company (IEOC), a subsidiary of Eni, holds a 100% stake in the South West Meleiha License.

DNO ramps up production at Peshkabir field, in Iraq

After announcing an output increase last month, DNO ASA exceeded its 30,000-bopd target at Peshkabir field, in the Kurdistan region of Iraq. The company initially reported that it would boost the field’s production rate by two-thirds, to at least 25,000 bopd, following completion of its Peshkabir-4 well testing program. “The pickup in Peshkabir production puts new meaning to the fast in fast-track in development of this field by the DNO team,” Bijan Mossavar-Rahmani, DNO’s executive chairman, said in a release. “And we expect Peshkabir to continue to surprise to the upside.” By the end of July, the field reportedly was producing approximately 35,000 bopd. Two more wells, Peshkabir-6 and Peshkabir-7, are scheduled to start production testing in August. “Peshkabir has now leapfrogged into second place, after Tawke, among the Kurdistan fields operated by the international oil companies,” Rahmani said. “We are setting our sights on higher production and accelerating field development.” 

Production begins at Australia’s Ichthys LNG project

INPEX Corp. (operator, 62.245%)—alongside partners Total (30%), CPC Corp. (2.625%), Tokyo Gas (1.575%), Osaka Gas (1.2%), Kansai Electric Power (1.2%), JERA (0.735%) and Toho Gas (0.42%)—started production at its Ichthys LNG project, offshore Western Australia. Produced gas will be gathered at the Central Processing Facility, Ichthys Explorer (pictured), and separated. Liquids are then piped to the nearby Ichthys Venturer FPSO, while gases are transported via pipeline to an onshore gas liquefaction plant in Darwin, Northern Territory. The development will produce approximately 8.9 million tons of LNG and about 1.65 million tons of liquefied petroleum gas per year. Additionally, it will produce approximately 100,000 bbl of condensate per day at peak. 

Total starts production at Kaombo field, offshore Angola

Total has announced the start of production at Kaombo field, Angola’s largest offshore development. The field, situated in Block 32, will produce via the Kaombo Norte and Kaombo Sul FPSOs. The Kaombo Norte FPSO went onstream in July and will produce an estimated 115,000 bopd. The Kaombo Sul FPSO is not scheduled to go online until next year. The FPSOs will develop the resources of Gengibre, Gindungo, Caril, Canela, Mostarda and Louro fields, which cover an area of 800 km² in the south-central part of the block. Overall production from both FPSOs is anticipated to reach an estimated 230,000 bopd. “The Kaombo start-up is a great milestone for Total. Developing the estimated 650 MMbbl of reserves will contribute to [our] growing production and cash flow in Africa,” Arnaud Breuillac, Total’s president of E&P, said in a release. “Total is proud to build on its deep offshore expertise to operate the latest major project coming on stream in Angola, which will account for 15% of the country’s oil production.” Total is operator of Block 32, with a 30% participating interest. Its partners include Sonangol P&P (30%), Sonangol Sinopec International 32 Limited (20%), Esso Exploration & Production Angola (Overseas) Limited (15%) and Galp Energia Overseas Block 32 BV (5%). 

Total acquires Engie’s LNG business for $1.5 billion

Total has acquired Engie’s upstream LNG assets, including participating interests in liquefaction plants, long-term LNG sales and purchase agreements, and an LNG tanker fleet, as well as access to regasification capacities in Europe. Among the acquired assets is interest in the Cameron LNG project, in southwestern Louisiana, as well as 18 LNG carriers and a global LNG trading contracts portfolio of 28 million tons/yr. “This transaction makes Total the second-largest global LNG player among the majors, with worldwide market share of 10%, and the group will manage an overall LNG portfolio of around 40 million tons/yr by 2020. It also helps us to build a position in the U.S. LNG market, with the 16.6% stake in the Cameron LNG project,” said Total CEO Patrick Pouyanne.

BP acquires U.S. onshore assets from BHP Billiton for $10.5 billion

BP has agreed to buy BHP Billiton’s assets in the Permian, Eagle Ford and Haynesville basins, as BHP exits the U.S. shale sector. The $10.5-billion acquisition represents the oil major’s biggest purchase in nearly two decades. Presently, the assets are producing 190,000 boed, 45% of which are liquid hydrocarbons, and cover 470,000 acres across Texas and Louisiana. The acreage is said to hold 4.6 Bboe of discovered resources, overall. BP upstream Chief Executive Bernard Looney said, “We’ve just got access to some of the best acreage in some of the best basins in the onshore U.S., and I think we have one of the best teams in the industry to work it.” 

Chesapeake Energy announces $2-billion divestiture of Ohio shale assets

Chesapeake Energy has agreed to sell its Utica shale assets in Ohio to Encino Acquisition Partners for $2 billion. It is CEO Doug Lawler’s biggest transaction in more than three years. According to the company, nearly all proceeds from the transaction will be used to pay down debt. Additionally, however, the transaction will aid the company in its efforts to focus its business more on the production of crude oil. Lawler reportedly is aiming to boost the company’s oil production by 10%, primarily through output growth in Wyoming’s Powder River basin. According to a company statement, output from the area is expected to more than double in the next year. “The Utica was the best asset for us to divest of, and what we have remaining in our portfolio is five very strong assets for future growth,” Lawler said.

Aker BP acquires license portfolio from Total for $205 million

Aker BP has agreed to acquire interest in Total’s portfolio of 11 licenses on the Norwegian Continental Shelf (NCS). The $205-million acquisition includes four discoveries—Trell, Trine, Alve Nord and Rind—with reported net recoverable resources of 83 MMboe. Because they are near Aker BP’s Alvheim field, Trell and Trine are expected to produce through the Alvheim FPSO (pictured). Likewise, the Alve Nord discovery is situated just north of Aker BP’s Skarv field and, therefore, it can be produced through the Skarv FPSO, in the northern area of the Norwegian Sea. In addition to the four discoveries, the transaction also gives the company increased interest in exploration acreage near its Ula field, in the southern section of the Norwegian North Sea.