FX Energy drilling in Poland’s Permian basin

FX Energy Inc., Salt Lake City, focuses on conventional oil and gas resources in Poland’s Permian basin.

FX Energy says Poland is underexplored; only one company was actively exploring in the country in the 50 years it was closed to the West. FX Energy has 3.2 million gross (2.7 million net) acres under lease, predominantly in the central lowlands of western Poland.

The company’s first production began in 2006 and it estimates it will produce 6 MMcfd equivalent from three wells in 2007, generating revenues of $15 million (Fig. 1).1

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NOC

Based in Warsaw, Polskie Górnictwo Naftowe i Gazownictwo Spolka Akcyjna (PGNiG SA) is the largest Polish oil and gas exploration and production company. As the national oil company, it is commonly known abroad as the Polish Oil and Gas Co. (POGC).

In addition to operating within Poland, POGC said in its 2005 annual report that the company’s international strategy includes acquiring exploration and operating licenses abroad “individually and jointly with interested Polish and foreign parties.”2

POGC spent about €110 on exploration in Poland in 2005, working in the Carpathians, Carpathian foothills, and Polish lowlands.2

FX project areas

FX has five main concession areas in Poland: Fences I, II, III; Northwest; Block 287; Kutno; and Block 255.

• The Fences project area covers 300,000 acres in western Poland’s Permian basin. FX Energy currently holds a 49% interest and POGC holds 51%. The three concession areas surround POGC’s Radlin field (390 bcf).

The Fences area is so named because when FX took the concession, the agreement was that any existing production controlled by POGC would be fenced off. Boundaries of the producing fields were delineated by seismic data, FX Energy told OGJ.

Gas flares in the left photo below during a drillstem test at the Roszkow well in May 2007 (Fig. 1; photo from FX Energy Inc.). Click here to enlarge image

The Fences concession holds four main areas of interest: Sroda area in north (3D seismic currently in processing for delineating additional wells); Ca2 area in northeast (test well approved for second-half 2007); Lubinia area in east (3D or drilling decision coming); and the “pinch-out” area in the southwest (“medium term” prospect).1

FX Energy drills the Roszkow well in the right photo below in February 2007 (Fig. 2; photo from FX Energy).Click here to enlarge image

The Zaniemysl-2 well, drilled in Fences I area in 2003-04, targeted the top of the Rotliegendes sandstone at about 2,940 m. It was spud in October 2003 and reached 2,850 m TD in 2004.

FX Energy has drilled the Sroda structure in Fences II area. The current producing well, Sroda-4, was drilled to 3,600 m, has 33 m net pay at 20-24% porosity and 8.8 md permeability, and produces 5 MMcfd.1 The company began drilling the Roszkow well in February 2007, reached TD at 2,900 m, and ran a drillstem test in May 2007 (Fig 2). The well was being tested when this issue went to press in June.

FX is waiting for production facilities for the Sroda-4, Winna Gora, and Roszkow wells.

The Northwest-Szczecin is a deep Rotliegend play extending from Germany. The company has 100% interest in 1.6 million acres.
The Block 287-Grabowka area covers 213,000 acres; FX Energy holds 100% and plans to reenter three gas wells this year.
FX Energy characterizes the Kutno structure as the “largest undrilled structure onshore Europe.”1 The company holds 100% interest in 284,000 acres.
The Pomerania project area covers 2.2 million acres in western Poland’s Permian basin. FX Energy currently holds a 100% interest in the Pomerania project area except for one block of 225,000 acres, where its interest is 74% and POGC holds 26%.
The Wilga project area, Block 255 covers 250,000 acres in east-central Poland. FX Energy holds 82% interest.

Partners

In October 2002, FX Energy signed a memorandum of understanding with CalEnergy Gas Ltd., an affiliate of MidAmerican Energy Holdings, Des Moines, Iowa, jointly to explore certain property interests in Poland (OGJ Online, Oct. 30, 2002).

In January 2003, FX Energy entered into a farmout agreement for the Fences I project area with CalEnergy, sharing 49% interest (OGJ, Feb. 16, 2004, p. 39).

FX Energy’s Scott Duncan told OGJ that the relationship remains the same in 2007.

After the 2004 discovery, FX defined the Greater Zaniemysl area. Duncan said the partners have not drilled since the second well was completed in 2004.

Houston-based Apache Corp. drilled about a dozen wells in partnership with FX Energy in the Pomeranian concession, in the Carpathians, and in the Wilga area.

The Tuchola 108-2 wildcat in the Pomeranian concession tested 9.5 MMcfd of gas from the Permian Main dolomite at 8,318-514 ft (OGJ Online, Jan. 15, 2001, p. 8).

The partnership generated a single producing well. Apache left Poland in January 2005. FX Energy continues to operate the single well in the Wilga area in central Poland, which produces 150 bo/d and 3 MMcfd natural gas (82% FX Energy; 18% POGC).1

Drilling contractors

Three core companies controlled by POGC perform contract drilling services:

Kraków Sp. z o.o.
Jaslo Sp. z o.o.
NAFTA Sp. z o.o. Pila.

FX Energy has drilled with Jaslo Drilling Co. and Pila Drilling Co., under an open bidding system. FX Energy told OGJ that the Krakow drilling company mainly operates abroad, using rigs which could be used in FX’s operational regions in Poland.

Oil & Gas Exploration Co. Jaslo Ltd. (Jaslo Drilling), Jaslo, southeast of Krakow, in eastern Poland. Jaslo drilled the Zaniemysl-2 well for FX Energy in 2004 in the Fences 1 project area of western Poland’s Permian basin (OGJ, Feb. 16, 2004, p. 39).

Oil and Gas Drilling Co. NAFTA Ltd. (OGDC) is based in Pila, Poland, and has been owned by POGC (100%) since 1998. OGDC performs contract drilling and workover services through Pila Oil & Gas Co. (Pila), with Polish national crews.

Pila has 10 land rigs that have worked in Poland, Hungary, Sweden, Algeria, Syria, Iraq, Pakistan, and India (OGJ, Jan. 23, 2006, p. 35). The fleet includes several types of single, double, and triple-stand rigs with top-drives and kelly’s: Massarenti Mas 6000 E; National 110 UE; IDECO (1200, 1000, 750); F-200; and P-80 (www.nafta.com.pl).

FX Energy told OGJ that four main rig types can drill in the Fences area, western Poland (Table 1). Hook loads range from 185-454 tonnes, and maximum nominal power ranges 950-3,000 kN.

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Seven smaller rig types operate elsewhere in Poland, with hookloads of 105-168 tonnes and maximum nominal power 475-900 kN (Table 1).

Drilling parameters

FX Energy told OGJ that all types of rock bits are used in the Fences area: tricone mill tooth and insert bits, PDC bits, as well as PDC and diamond coring bits where necessary. Jaslo Drilling provided rate of penetration data for four types of drillbits used in the Fences area (Table 2).

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Several contractors provide drilling fluid services with various chemicals available. FX Energy said several types of drilling mud are used in operations at Fences area (Table 3):

Top hole (24, 17-in. bit) is drilled with bentonite and low sp gr.
After surface casing, potassium mud is used with a 12 1/4-in. bit, 1.25 sp gr.
Using an 8 1/2-in. bit, salty barite mud is used with 2.35 sp gr.
Final drilling to TD with a 5 7/8-in. bit, salty polymer mud, and 1.2 sp gr.

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Formations

The formations in the Fences I, II, and III concessions in western Poland include the Quaternary; Tertiary; Jurassic; Rhaetian; Kauper; Muschelkalk; Upper, Middle, and Lower Bundandstein; Zechstein, and Rotliegende (Table 4). Average depth of a medium well is 2,850 m; a deep well averages 3,650 m.

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Porosity and permeability of the formations drilled in Poland’s Permian basin range from the tight main dolomite (Lower Bundsandstein) at 10% and 10 md, to 27% and approaching 600 md in the productive Rotliegende sandstones (Table 5).