Barrett Resources (Peru) Corp. signed an exploration and development contract with Perupetro SA, Peru's oil regulator, for Block 39 in the Maranon basin. The area adjoins Block 67 where the Denver company last year discovered heavy oil in the three wells it drilled.
Barrett's president Ralph Reed said that the company estimated probable reserves on Block 67 of 90 million to 300 million bbl of 12-21°-gravity oil. Consultants, taking into account 15 additional exploratory prospects, said potential reserves ranged between 391 million bbl in the most probable and 1.517 billion bbl in the most optimistic case, according to Perupetro.
Reed said that Barrett is talking to nine companies in its search for a partner to continue exploring 2-million-acre Block 67 and that he hoped to have an agreement shortly.
Barrett, the operator, holds 70% of the contract on Block 67 together with Korea Petroleum Development Corp. 20% and Hyundai Corp. 10%. The partners have spent $66 million to date on exploration, Reed said.
The contract in Peru is Barrett's only international venture. The company, based in Denver, said it produces 300 MMcfd of natural gas and holds two thirds of its 1 tcf of reserves in the Rocky Mountains. Except for the Peruvian venture, the company is almost exclusively geared toward gas.
On neighboring Block 39, Barrett in the first stage will undertake oilfield studies and reprocess 1,200 km of existing 2D seismic lines. The 7-year exploration period also includes acquiring 350 km of 2D seismic lines and drilling of four wildcats.
The 1.1 million acre block was explored by Union Oil Co. of California in the 1970s and later by Occidental Petroleum which acquired seismic studies and drilled an exploration well before leaving the area.
Block 39 also neighbors Occidental's Block 1-AB where the company produces a range of heavy to light crudes (11-35? gravity).
Royalties for production of gas, condensate, and oil pegged to the R factor will range from a minimum 18% to a maximum 50.2% with a 2.0 or more R factor if oil prices reach $45/bbl.
Perupetro president Juan Assereto said that with the latest contract, Peru now has 15 producing contracts and 22 exploration contracts.
The contract with Barrett Resources, signed Sept. 9, is the first exploration and development contract Perupetro has signed this year. Perupetro is negotiating a contract with Advantage Resources for Block 87 in the Huallaga basin-formerly labeled Block 72 and explored by Occidental.