By an OGJ correspondent
BANGKOK, Mar.10 -- Royal Dutch/Shell Group cut back spending for its oil development project in Thailand this year by nearly 12% from 2002's level, company officials said.
Thai Shell Exploration & Production Co. has earmarked $36.5 million to develop its S1 tract in northern Thailand this year, down from $41.3 million spent last year. The cutback means there will be fewer wells drilled this year and the production of crude oil and associated gas coming from its Greater Sirikit field will fall, officials said.
For 2003, Thai Shell and its minority partner, PTT Exploration & Production PLC (PTTEP), will drill 17 new wells, compared with 26 last year. Like last year, all of the wells planned will be development holes.
Average crude oil production is expected to drop to 17,500 b/d from 20,602 b/d in 2002, according to company insiders. Likewise, associated gas output is anticipated to fall to 55 MMcfd from 56.2 MMcfd. However, average daily LPG production, processed from the associated gas, would rise to 314 tonnes from 298 tonnes recorded last year.
Thai Shell also decided to cancel the costly waterflood project that was planned me to arrest the rapid decline in pressure in the main area of the 21-year-old Sirikit field (OGJ Online, Dec. 28, 2001).
"Detailed feasibility studies indicate that Sirikit's main complex geology would not effectively respond to the water flood technique," said an insider.
It was found that 30-40 bbl of water would need to be injected into the reservoir in order to get an additional barrel of oil. In other words, the water flood project could only recover 2-3% of oil from the tight sand of the reservoir.
Thai Shell found that most wells drilled in recent years had lower pressure and that production declined quicker.
Nevertheless, Thai Shell believes there are some 88 million bbl of crude and 304 bcf of gas remaining to be produced from Thai onshore acreage, situated largely in Kamphaeng Phet and Phitsanulok provinces.
As of January, cumulative production was 143.5 million bbl of oil and 317 bcf of gas, with a total of 329 wells drilled.
