P. 5 ~ Continued - OGJ Newsletter

Nov. 14, 2011

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Drilling & ProductionQuick Takes

BP drills Itaipu-2 appraisal well off Brazil

BP PLC and its partners reported the successful drilling of the Itaipu-2 appraisal well on Block BM-C-32 in the presalt play offshore Brazil. The well was drilled to 16,000 ft total depth in 4,660 ft of water in the Campos basin and found a gross petroleum column of 58 net ft of presalt carbonate reservoir.

The appraisal well is an "aggressive step-out" from the Itaipu discovery well, which lies 4 miles to the northwest, said Bob Daniels, senior vice-president, worldwide exploration, Anadarko Petroleum Corp., which is a partner in the block (OGJ Online, Dec. 18, 2009). "The Itaipu-2 well established a fluid contact and appears to have successfully extended the accumulation 120 m downdip from the discovery. Accordingly, the appraisal well significantly increases the areal extent of the vast Itaipu field, and we believe incorporating the data from both the appraisal well and the original discovery well will increase our previous resource estimates for the field," Daniels said.

BP operates Block BM-C-32 with a 40% working interest. Anadarko, through a wholly owned subsidiary, holds a 33.3% interest, and Maersk Oil holds a 26.7% interest.

Flow starts from small gas field off India

State-owned Oil & Natural Gas Corp. of India has started production of natural gas from the BS-13 satellite field in its B-22 cluster project in Bassein oil and gas field in the Mumbai High area offshore western India.

The BS-13A-2H well began production at the rate of 200,000 standard cu m/day through a 32⁄64-in. choke. It's on a conventional, four-leg fixed jacket platform powered by a solar system and connected to the BPB process complex (OGJ Online, Jan. 24, 2011). The platform has four well slots.

ONGC estimates B-13 reserves at 1.7 billion cu m.

The B-22 cluster project combines development of marginal fields designated B-22, BS-12, BS-13, and B-149.

Niko signs deepwater drilling contract for Indonesia

Niko Resources Ltd., Calgary, signed a drilling contract to use Diamond Offshore Drilling Inc.'s Ocean Monarch semisubmersible, currently moored, offshore Indonesia. The contract covers 4 years and has a 1-year option.

The Ocean Monarch is capable of operating in 10,000 ft of water with a drilled depth of up to 35,000 ft. With the option year exercised, this contract is in excess of $700 million, Niko said.

Raymond James & Associates Inc. issued a Nov. 9 research note saying, "Such strong contract terms are further evidence that offshore markets (both floater and jack ups) continue to improve."

Niko said the contract is expected to commence sometime during June through August 2012 following completion of the semi's current contract and a routine 5-year hull inspection.

"This contract removes the risk of rig availability for the company's planned massive drilling campaign," Niko said Nov. 8, calling the agreement the "largest deepwater exploration contract in the history of Indonesia."

Niko is Indonesia's largest deepwater acreage holder with interest in 16 production-sharing contracts. Niko has exploration and production assets in India, Bangladesh, Indonesia, the Kurdistan region of Iraq, Trinidad, Pakistan, and Madagascar.

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