The first discoveries in the South Padre Island federal planning area in the western Gulf of Mexico are to start producing natural gas by yearend.
F-W Oil Exploration LLC, private Houston independent, will start flowing 30 MMcfd of dry gas from wells on three blocks 11-12 miles off Port Isabel, Tex. One of the wells is within 6 miles of Mexican waters.
F-W Oil Exploration and GE Commercial Finance Energy Financial Services, Stamford, Conn., formed a partnership in which GE Commercial will invest $70 million, its first offshore underwriting. Total project cost exceeds $100 million. The project involves two fixed-leg platforms to handle production from South Padre Island 1166, 1152, and 1145.
F-W Oil Exploration will lay a 48-mile, 12-in. pipeline northward along the coast to connect with an existing company gas line in North Padre Island East Addition 966. Gas fields in the southern part of the North Padre Island area are the nearest production to the South Padre Island discoveries.
The pipeline and four wells F-W Oil Exploration drilled and completed in January and February 2005 to confirm the reserves, whose volumes are not specified, are in 100-120 ft of water. F-W Oil Exploration expects to begin drilling on nearby leases in the first quarter of 2006.
Wells drilled by other operators in the mid-1990s found gas in Miocene or younger reservoirs at less than 1,500 ft, but the gas has remained stranded until now, said Douglas C. Nester, F-W Oil Exploration chief operating officer. The wells should produce for 3-4 years, he estimated.
The company holds 28 blocks in shallow federal and state gulf waters and was high bidder on 4 more blocks at the Aug. 17, 2005, federal lease sale. The 4 blocks are not yet awarded. ✦
