By OGJ editors
HOUSTON, Nov. 26 -- Niko Resources Ltd., Calgary, began work this month on newly acquired Block 9, which covers 6,880 sq km surrounding the capital, Dhaka.
Drilling is set for the Rafulpur, Lamlai, and Bangora North prospects. Niko has 60% interest and will become operator upon declaration of a commercial discovery.
Block 9 has been the site of 450 sq km of 3D seismic surveys and 1,010 km of 2D seismic surveys, but no drilling has taken place.
Niko acquired interest in the block in September from a unit of ChevronTexaco Corp. Other Block 9 participants are Tullow Bangladesh Ltd. 30% and Bangladesh Petroleum Exploration & Production Co. Ltd. (Bapex) 10%.
In October, Niko signed a joint venture with Bapex that takes in Chattak gas field in northeastern Bangladesh and Feni field southeast of Dhaka.
Chattak and Feni fields have produced gas but are currently shut-in. Niko plans to rework one of the two existing wells and drill a new well in March 2004 at Feni, which covers 43 sq km.
The Chattak structure covers 376 sq km. The upper fault block to the west has produced from one well, but the large downthrown fault block has not been drilled. Development drilling at West Chattak in third quarter 2004 is to be followed by exploration of the downthrown block.
Major terms of the Feni and West Chattak JV are that Niko will pay 100% of the costs to earn 80% with a sliding scale to 58% subject to a 300% capital cost recovery. In East Chattak, Niko will earn 75% with a sliding scale to 50% subject to a 300% capital cost recovery.
Gas sells at $2.25-2.50/Mcf, and Bangladesh is experiencing a supply shortfall, Niko noted.