Esso adds fields as Chad’s oil output lags expected level

Sept. 4, 2006
Chad’s oil production averaged just above 170,000 b/d in 2005 as output ran below the planned initial 230,000 b/d level.

Chad’s oil production averaged just above 170,000 b/d in 2005 as output ran below the planned initial 230,000 b/d level.

The project had shipped more than 133 million bbl of 20.5° gravity Chadian crude to world markets by the end of 2005, said oil field operator Esso Exploration & Production Chad Inc. in the project’s annual report.

By the end of 2005, 143 export tanker loads had been lifted from the FSO off Kribi, Cameroon, following shipment through the Chad-Cameroon oil pipeline. That had brought the Chad government more than $420 million in royalties, dividends, and share premiums. Of that, almost $241 million was paid in 2005.

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“The current record high prices for oil around the world have increased total revenue paid to Chad to levels much higher than anticipated by some revenue estimates during the project’s planning phase,” the report said.

“These elevated revenues have been achieved even though the relatively low quality of Doba crude places its market value significantly below the benchmark Brent North Sea crude that is generally reported by the popular news media, and despite the fact that daily production levels have thus far been lower than originally planned” (see map, OGJ, Apr. 5, 2004, p. 54).

Work was nearly completed on decommissioning 24 exploration-era wells in a wide area of southern Chad. In most cases the exploration wells are remote from villages, so the project funded the drilling of five new water wells and hand pumps at the village closest to each location.

Some of the sites date to the first days of project exploration more than three decades ago, ranging from Lake Chad to Bongor to East Doseo and the Doba basin.

The wells had been plugged when abandoned, but the project’s environmental plan called for additional site restoration.

Esso Chad operates the Doba fields on behalf of itself, Malaysia’s Petronas, and Chevron Corp.

Meanwhile, the government was establishing a national oil company, Soc. Des Hydrocarbures du Tchad (SHT), to become the fourth member of the production group.

Expanding oil fields

The operating group spent $232 million in development funds in 2005, bringing capital outlays in the effort to further develop Chad’s oil to $4.7 billion.

Some $137 million of 2005 outlays went to develop new fields beyond the project’s initial three, Kome, Bolobo, and Miandoum. The other spending was for running seismic surveys and drilling exploration wells.

Moundouli field was to have produced its first oil near the end of March 2006. Its 25 wells are 33 km west of and connected by gathering line to the Miandoum gathering station. Moundouli field construction was 75% complete at the end of 2005.

Smaller Nya field, adjacent to Miandoum field, went on production in mid-2005.

Exploratory drilling in the Maikeri-Poutouguem area has proven the commercial feasibility of a potential new oil field.

The field could add as many as 17 new producing wells. The project submitted a concession application to the government.

Engineers were also assessing the feasibility of a potential new development based on test well results at Timbre.

Meanwhile, major exploration efforts have shifted to a vast area east of the town of Sahr in the East Doseo basin where access roads, well pads, and worker construction camps have opened the way for test drilling. The group built a temporary road that extends 160 km east of Sahr.

Production challenges

Formation complexities are making extraction of oil from the three initial fields more challenging than expected.

Drilling teams added 75 wells in 2005 in the three fields, most of them infill wells, bringing the total number of producing wells to 279 at the end of the year.

The project also doubled the number of deep injection wells to 17. The wells return the water that was produced from the formation that contains the oil.

The Doba area oil wells produce more water than expected, and the added injection wells boost the project’s capacity to process the water-laden crude oil. The wells will be used for pressure maintenance in coming years.

Crews also conducted wireline logging to gather temperature, pressure, and other geological data. They ran plugs to block water production, upgraded submersible pumps, and acidized and fractured the producing formation.