Juan Carlos Pucci
Consulting petroleum geologist
Buenos Aires
Here is the second part of an article on the potential of Argentina's exploitation/exploration association contract areas. Illustrations are published with Part 1 of the article (OGJ, June 13, p. 138).
The majority of the Austral basin fields discovered are mainly associated with structural and combination traps.
Except for El Condor, La Sara, and San Sebastian fields, most of the oil reserves are of limited size. This is due to several factors: small areal extent (5-50 sq km), variability of the Springhill thickness which frequently wedges out over the top of structures, facies changes and related complex reservoir distribution, and lack of hydrocarbons.
Until 1985, all the commercial discoveries have been made in the area of the platform mostly in the Springhill reservoir and to a lesser extent on top of the volcanic Bahia Laura group (equivalent Lemaire or Tobifera formations).
However, the Tertiary discoveries in Campo Boleadoras and Puesto Peter fields opened a zone, named "Intermediate" by YPF's geologists, located to the west of the known producing areas. In this zone, the lower member of the Magallanes group has yielded production. This new play probably reaches from the southern Chilean border to about 30 S. Lat. The area has an average width of about 90 km.
The hydrocarbons are mainly accumulated in combination traps. In addition, the shaly intervals of the Springhill formation and the lower section of the Cretaceous Palermo Aike group are at present time in the oil window beginning at 7,872 ft for the Palermo Aike and 8,528 ft for the continental Springhill shales. The beginning of the gas window is around 11,480 ft for both formations.5
The southern part of the Santa Cruz province adjacent to the Magellan straits and their offshore extension and the northern part of the Tierra del Fuego island are most prospective zones. In addition, north of the town of Rio Gallegos, the gentle tectonics and the lateral distance to the generation zone are unfavorable factors for the discovery of new significant fields.
In the western part of the basin, adjacent to the Andes, the Springhill shales are more than 13,120 ft deep and, if present, should be overmature or gas-prone. However, accumulations in Tertiary strata are likely.
NORTHWEST BASIN
The other two association areas called Aguarague and Palmar Largo are located in the Northwest basin (Fig. 2).
The Northwest basin has an areal extent of 150,000 sq km and consists of Paleozoic basins and a Cretaceous basin containing a number of localized depocenters. The basin is subdivided into two main structural provinces: the fold belt to the west and the Chaco platform to the east.
The Aguarague and Palmar Largo areas contain 54% and 43% of the basin's oil and gas reserves, respectively.
Since the beginning of exploration 92,970 line km of seismic lines were acquired and 1,215 wells were drilled through December 1991, of which 323 were wildcats.
One of the Paleozoic basins is the producing Tarija basin, the southernmost extension of a sedimentary basin mainly developed in Bolivia. The sedimentary sequence of the Tarija basin consists of a Precambrian metamorphic basement covered by marine Cambrian to Devonian strata.
These sediments are unconformably overlain by fluvioglacial and partly littoral deposits of Carboniferous age that are separated by an unconformity from marine and nonmarine Triassic sediments; they are unconformably followed by a thick continental Tertiary sequence.
The traps are related to structures developed during the Andean orogeny.
The Aguarague area has an areal extent of 15,740 sq km and includes Aguarague, Campo Duran, Madrejones, Rio Pescado, and La Bolsa fields. All of the fields except La Bolsa contain reservoirs of Paleozoic age.
Aguarague field is the last major discovery in Devonian reservoirs. During 1977, YPF drilled the 1X Cuchara discovery well, followed in the same year by the 199XP Tranquitas deep exploration well which also flowed hydrocarbons from Devonian strata.
Aguarague field is in the Aguarague ranges (Subandean belt). It is the surface expression of a south-southwest/north-northeast trending anticline 80 km long in Argentina extending 180 m into Bolivian territory. Aguarague field contains several culminations separated by structural saddles.
Length of the trap is 30 km in a south-southwest/northnortheast direction and the width measured by the 3,800 subsea contour varies between 10,824-13,448 ft; areal closure is 92.48 sq km.
The hydrocarbons were sourced in Devonian Los Monos shales; they accumulated in fractured quartzitic sandstones of the Devonian Santa Rosa formation.
The reservoir net pay is 492 ft with an average porosity of 4.5% and average permeability of 0.2 md. Five types of secondary porosities due to diagenetical and tectonic processes were recognized.7
In Aguarague field the average depth to reservoir is 15,088 ft; oil gravity varies between 44-54.
By June 1991, 14 wells were producing 4,076 b/d of condensate and 88.25 MMcfd of gas. At the end of the same year, the remaining reserves were 60.2 million bbl of condensate and 2.28 tcf of gas.
Campo Duran and Madrejones fields were discovered in 1951 and 1953, respectively.
YPF CD-6, the discovery well of Campo Duran field had an initial production of 1,890 b/d of oil and 29.65 MMcfd of gas from sandstones of the Carboniferous Tupambi formation.
The trap is a northeast-southwest trending anticline divided by longitudinal faults dipping to the south; two transverse faults divide the field into several blocks.
The reservoir rock consists of argillaceous sandstones with porosities averaging 12%, permeabilities 18 md, and an average net pay thickness of 49 ft. The water contact is at 10,824 ft below sea level; vertical closure is 1, 148 ft.
As of December 1991, only one well out of 52 drilled was producing 55 b/d of 54. condensate and 2.5 MMcfd of gas. By that time remaining reserves were 6.6 million bbl of condensate and 406 bcf of gas.
Madrejones field was put on production in 1959. A total of 26.65 million bbl of 52.3 gravity condensate and 4.77 bcf of gas were recovered from Tupambi sandstones with 38 wells drilled.
The trap corresponds to a northeast-southwest trending anticline faulted on both flanks. The structure plunges north into Bolivian territory, where six wells produced 1.26 million bbl of condensate.
Rio Pescado field was discovered in 1932 and shut-in by 1954. During 1986, YPF drilled three wells that produced 95 b/d of 47.6 gravity oil from Tertiary strata. A total of 31 wells have been drilled in the field.
By December 1991 the field had a total full recovery of 3.96 million b/d of oil an 10.6 bcf of gas.
Within the Aguaragu area one tract falling in the Cretaceous Lomas de Olmedo sub-basin was included; it contains La Bolsa field not fully developed. Th original reserves are 2.1 mil lion bbl of oil.
The successful bidder paid $143-717 million for 70% of the association.
Palmar Largo field lies in the Cretaceous basin. The name Cretaceous basin is commonly used for the numerous sub-basins that lie across the Chaco-Eastern cordillera region and are filled with a thick sequence of Cretaceous-Paleocene sediments. The main producing portion of the basin known as Lomas de Olmedo is located further to the east.
The sub-basin extends into Paraguay, although no commercial discoveries have been reported.8
The Cretaceous basin has a pre-Carboniferous substratum and is overlain by a thick continental Tertiary section. It is bounded in the south by the Quiquincho arch and in the north by the Michicola arch, the southern limit of the Carboniferous sedimentation.
In 1983 after completing a seismic survey in the easternmost part of the Lomas de Olmedo sub-basin, YPF drilled the 1X Palmar Largo wildcat with Yacoraite limestones as the original objective. However, after penetrating the Yacoraite reservoir below 12,529 ft the well encountered a 328 ft thick volcaniclastic sequence having excellent reservoir properties and flowing 3,408 b/d of 42.3 gravity oil. This was the first discovery in volcanic reservoirs and thus became a new play in the basin.
Palmar Largo is an elongated structure with two culminations trending east-west.
The eastern culmination is higher with a steep slope, the western culmination is lower with a gentle slope. The oil water contact is at 12,070 ft below sea level.
The volcaniclastic reservoir has an average porosity of 17% with permeabilities of 55-70 md. The average drilling depth to the reservoir is 12,792 ft.
As of December 1991, the recoverable remaining reserves were 17.96 million bbl of oil. Of the 20 wells drilled, 11 have produced 6,514 b/d of oil and 3.6 MMcfd of gas. In addition, a horizontal well was drilled and flowed 2,998 b/d of oil.9
Canada Rica field is the second largest field with reserves contained in volcanic reservoirs (Palmar Largo formation).
The field was discovered during 1986 and at the end of 1991 the recoverable remaining reserves were 1.2 million bbl of 42. gravity oil.
The field covers 3.5 sq km with 92 ft of closure. The net pay of the reservoir rock is 36 ft thick with an average porosity of 13.5%. Two wells yielded 620 b/d of oil.
The rest of the fields with volcanic reservoirs have a total recoverable remaining reserves of 716,127 bbl of oil and have three wells with an average production of 454 b/d of oil.
The remaining fields contain 1.07 million bbl of oil reserves in the Yacoraite formation. A 70% share of the association brought $36.1 million.
FUTURE EXPLORATION
The Aguarague tract includes about 15,000 sq km for exploration.
At the beginning of exploration, the efforts were concentrated in post-Devonian objectives; hydrocarbons were found in Carboniferous reservoirs and minor accumulations in Tertiary strata. Some of the wells drilled in the past penetrated Devonian beds but did not test them.
Only after completion of YPF's 11XP Ramos well in 1976 were commercial discoveries made in pre-Carboniferous reservoirs, thus confirming possibilities in Devonian rocks. In Madrejones and Campo Duran fields future exploration will focus on Devonian sediments by deepening wells.
To the west of the Aguarague ranges, at least five structures of approximately the same structural style and containing the same stratigraphic sequences appear to have the required ingredients for the accumulation of hydrocarbons: traps, reservoirs (mainly Carboniferous, Devonian, and probably older), and proven source rocks (Los Monos formation), which also serve as seals. In addition, accumulations in Tertiary sediments between 4,920-6,560 ft depth are expected.
Reserves are estimated at 277 million bbl of condensate and 7.06 tcf of gas in that part of the basin.
One of the negative factors is the rough terrain and resultant difficult access.
Future exploration in the Aguarague area may include structural prospects beneath the tectonic detachment surfaces; there may well be structural closures with reservoirs and source rocks lying below the detachment.
In the eastern part or platform of the Aguarague area, some noncommercial quantities of oil were recovered.
Although positive anomalies, reservoirs, and seals have been recognized by seismic and wells, the prospectivity depends on the occurrence of mature source rocks. The discoveries were possibly due to local conditions or, although unlikely, to main lateral migration.
The Palmar Largo association area has a surface extent of 17,000 sq km which may contain major remaining exploration opportunities.
In the Paimar Largo area, in addition to the established production, the Cretaceous basin has the basic parameters to discover new fields similar to Canada Rica, El Potriflo, La Tierra Norte, and others in volcaniclastic reservoirs. However, a detailed study is necessary in order to establish the exact areal distribution of the volcaniclastic reservoirs (Fig. 2).
In addition, the Yacoraite formation is still a play of interest on the north flank of the Lomas de Olrnedo sub-basin. This assumption was confirmed in 1990 by the YPF Balbuena Este discovery well, which had an initial production of 844 b/d of oil from Yacoraite. It is estimated that many structures have yet to be drilled; hydrocarbons sourced in the Olmedo shales may have migrated updip from deeper parts of the basin.
Future studies may lead to the discovery of new reserves in pre-Cretaceous (mainly Devonian and Silurian) reservoirs.
The Silurian and Devonian rocks are widely distributed in northern Argentina and contain intervals with source rock characteristics. However, the geothermal gradient is more than 3/1OO m in most of the Lomas de Olmedo sub-basin; therefore Lower Cretaceous and Paleozoic reservoirs most likely here may contain condensate and gas.
Additional prospects in the Yacoraite formation, like Caimancito and Cuchuma fields, can be expected in faulted anticlines located along the fold belt and foothills between 2,300-13,120 ft depth.10
More than 9.45 million bbl of oil and 17.65 bcf of gas are the estimated probable reserves in the presently producing fields.
CONCLUSIONS
The hydrocarbon policy carried out by the new administration, with had its culmination with privatization of YPF, is probably unique outside of the U.S.
In less than 3 years Argentina's oil and gas industry was deregulated and the state monopoly terminated.
In the case of the upstream sector, and in order to reduce the percentage of the oil and gas production controlled by the state, three types of tenders were implemented to reach such objectives: the offering of marginal fields, the association with YPF in central fields and in major exploration areas containing substantial hydrocarbon reserves (Table 3).
The new petroleum policy has been successful. In addition to the funds, taxes, and royalties collected by the federal, state, and provincial governments and the increase in production, more than 50 local and foreign companies are operating, free to participate in the transport, refining, and marketing of hydrocarbons.
The former state monopoly YPF, now trading on the New York Stock Exchange, reduced its work force to 10,600 employees from 56,000, accompanied by a sharp rise in productivity and efficiency, and presently competes with private companies in upstream and downstream operations.
For countries unable to develop proved reserves due to lack of sufficient funds but with urgent needs to attract foreign investment, the offering of marginal fields is probably one of the best options.
Under the marginal fields cash bidding system, the government awards the areas to the highest bidder satisfying specified financial and technical criteria. The areas are awarded as concessions for 25 years. The cash offered is collected within 5 days after the bid approval and before companies enter the area. However, in the bidding conditions, the government does not guarantee the reserves or the areas' indicated potential for exploration, exploitation, and development of hydrocarbons.
Argentina's experience shows that the use of the reserves as a parameter to select the areas is preferable over the daily production of the previous years.
This type of bidding system may also be implemented for larger fields; however, it is not recommended to include adjacent zones of significant exploratory interest exceeding the 1,000 sq km area limit.
ACKNOWLEDGMENTS
Appreciation is given to Dr. J.C. Pratsch for reviewing the manuscript and his constructive comments, to Pablo Ambrosini for processing the data, and to Vanesa Taconi and Graciela Pucci for typing the manuscript.
REFERENCES
- Pucci, J.C., Evolucion de la exploracion, produccion y reserves, Sec. of Energy, unpublished report, 1992.
- Pucci, J.C., Datos geoquimicos de las rocas madres de Argentina, unpublished report, 1992.
- Arcienega Miranda, F., and Morateflo, J.H., Estudio geologicominero del yacimiento Vizcacheras, Bol. Informaciones Petroleras (YPF), Vol. 22, 1990, pp. 31 51.
- Yrigoyen, M., Hvdrocarbon resources of Argentina, Revista Petrotecnia Special Issue, October 1991, pp. 38-54, Buenos Aires.
- Pittion, J.L., and Gouadain, J., Source rocks and oil generation in the Austral basin, 13th World Petroleum Congress proceedings, J. Wfley & Sons, Vol. 2, 1991, pp. 113-120.
- Laffite, C., Arias, W., and Marinelli, R., Caracterizacion termica de la formacion Springhill, cuenca Austral-relacion con el entrapamiento de los hidrocarburos, Arpel 60th reunion anual a nivel de expertos, exploracion 3-14, 1986, Lima, Peru.
- Mombru, C., and Aramayo FloTes, F., Geologia del yacimiento Aguarague, Bol. Inf. Petroleras (YPF), Vol. 6, 1986, pp. 53-64.
- Pucci, J.C., Resumen de las cuencas sedimentarias del Paraguay, Bol. Inf. Petroleras (YPF), Vol. 28, 1991, pp. 42-48.
- Pocovi, A., Pozzio, A., and Guastavino, L., Perforacion horizontal del pozo YPF Fr. PL. 21H, yacimiento Palmar Largo, Formosa, Bol. Inf. Petroleras (YPF) Vol. 26, 1991, pp. 35-56.
- Pucci, J.C., A review of Argentina's sedimentary basins, OGJ, June 1, 1987, pp. 52-55.
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