John L. Kennedy
Editor
The U.S.S.R. is interested in attracting small and medium sized firms to help develop smaller, difficult fields as well as big international companies to participate in giant fields like Tengiz.
On a recent trip to Moscow and to areas around the Caspian Sea, U.S. independents and representatives of several international firms discussed a number of fields that might be available for joint ventures between the Soviets and western companies.
The Soviets said at least 10 operators purchased the first information packages offered by a joint venture of the U.S.S.R. Ministry of Oil and Gas Industry and Professional Geophysics Inc., Houston, on five areas in western Siberia (OGJ, Mar. 19, p. 15). And Chevron recently disclosed that Tengiz may be added to a joint venture calling for exploration, development, and production in the Northeast Caspian Sea region (OGJ, June 11, p. 18).
But smaller joint ventures are of interest, too, say the Soviets. In addition to development agreements-possibly permitting exploration as an added incentive-manufacturing of drilling and production equipment will be considered.
Soviet law concerning joint ventures is changing, and organizations are being formed that can deal directly with western partners.
"Soviet law about joint ventures is a framework that leaves details to the partners' discretion," said a Soviet spokesman.
"The property of a joint venture is under the same safeguard as Soviet property. It can't be eliminated by administrative order. Only a court can do that."
Much has been written about joint ventures with the Soviets in recent months. Details vary widely, depending on whether the project is a petrochemical plant or an exploration program.
But some detail on projects discussed with the delegation of U.S. independents gives an idea of the type of opportunities the Soviets are offering to smaller companies in the Caspian Sea area.
Some packages discussed during the delegation's visit even the small ventures may be too large for some independents. A Soviet spokesman said size of the offerings could be reconsidered.
SCHEVCHENKO AREA DATA
Typical of the small field projects discussed by the delegation of U.S. independents are fields around Shevchenko on the eastern side of the Caspian the Soviets have said are available for joint ventures.
Soviet officials in the area want to collaborate with western firms that can provide improved exploration and production technology to develop hard-to-produce fields. Aims are to reduce costs and to improve safety and environmental protection.
The possibility of building a refinery in the area also was discussed.
Representatives of the Mangyshlak Oil Association in Schevchenko outlined operations in the area and described undeveloped oil discoveries that are typical of projects for which foreign joint ventures are sought.
The association operates 28 fields in the area, 17 of those are in "commercial operation," including Uzen, the largest. Total production is about 16.5 million tons/year.
Much of the production is high in wax content-as much as 20-30%-with a high pour point. Sulfur content is typically 2%.
Hot water is injected in some wells to boost recovery. Polymer is being injected in others.
The association drills about 800,000 m/year of development wells and about 70,000 80,000 m/year of exploration hole.
DUNGA FIELD
Association Chief Geologist Dimitriev says the most promising field in the Schevchenko area is Dunga, with an estimated 50 million tons of oil in place and 16.5 million tons recoverable.
Top of the pay, a fine grained sandstone, is at about 1,800 m. Three producing zones, each 5-10 m thick, are separated by shales. Total net pay is about 20 m.
The two upper zones are Lower Cretaceous, the lowest zone Upper Jurassic.
Of the 30 wells drilled in the field, all but five have been dry. An association spokesman said four more wells are needed to define the field.
Completed wells typically have flowed only 2-3 hr on test at a rate of 5-30 tons/day, and no other testing has been done.
Based on experience in nearby fields, production problems are likely to include paraffin and scale deposits in tubing. Similar wells in the area can become plugged in as little as 10 days.
The field was discovered in 1970 based on seismic surveys conducted in the 1960s. No more seismic work has been done since discovery, but the association plans a detailed seismic survey.
No reservoir stimulation has been done.
Another available field is similar to Dunga but with much smaller reserves.
Operations in a third field, Severo-Buzachin, 200 km north of Schevchenko, also were discussed.
Although Severo-Buzachin has not been produced, problems similar to those experienced in a nearby field can be expected, Soviet specialists say. Sand produced with high viscosity oil in the nearby field erodes equipment and poses a disposal problem.
Oil viscosity is 250-350 cp at reservoir temperature of 26 C. at a depth of 350 m.
ANOTHER REGION
Some discoveries in Daghestan, on the western side of the Caspian, also have potential, Soviet officials say. A spokesman describes the region as the most prospective province in the Caucuses because 35,000 sq km are still unexplored.
Discoveries were made in the early part of the century, but production is still modest. In the 1970s, oil and gas production reached the equivalent of about 3 million tons/year (60,000 b/d). Now, oil production is about 620,000 tons/year and gas production is 800 million cu m/year.
About 1,000 wells have been drilled.
Some of the fields in the area that could be candidates for joint ventures have been abandoned for some time. Abandonment is typically at producing rates of less than 0.1 ton/day.
According to spokesmen for Dagneft, the local oil association, there are 26 deposits in the region, including about 200 oil and gas zones. Most zones are shallow sandstones. None is large. Depths range from 250 m to 5,000 6,000 m.
The association is drilling 60-70,000 m/year of exploratory hole. Most wildcats are in the 5,000-5,800 m depth range.
Most reservoirs are water drive, and Soviet specialists say reservoir pressure typically drops 20% during exploitation. Some reservoirs are solution gas drive. There is no sulfur in the oil, and gas contains "insignificant amounts."
Oil recovery ranges from 15% to 20%.
Old fields containing viscous oil are typical of projects in which the Soviets want help from western partners. For example, a steam project begun in 1984 is now suspended due to corrosion.
Most of the region's production is in the north. Twelve deposits, located mainly in the southern part of the region, have been abandoned. Depth of these zones ranges from 250 to 800 m. Heat is required to produce the oil.
One of these deposits has not been explored due to environmental problems, and exploration on the shelf in the Caspian also has been halted for ecological reasons. Soviet technology could not guarantee against a problem in the resort area, a spokesman said. He said a joint venture might be possible to develop this Caspian prospect if the western partner could furnish technology that would guarantee against environmental damage.
The Caspian deposit is in 30-40 m of water.
A joint agreement was worked out with a U.K. firm to drill in the Caspian, but that proposal has been tabled, Dagneft said. Three wells were drilled to 2,000 m in the field, but they have been plugged.
Dagneft has 22 rigs, typically rated at 2,200 hp. Deepest well in the foothills is 5,700 m. In the north, the deepest hole is 6,036 m. In the foothills, it takes about 3 months to drill to 3,000 m and requires 50 bits. In the north, drilling time to the same depth is about 1 month and requires only 10 bits.
Trip time from 3,000 m is 10-11 hr.
Moving a rig on the flats by truck takes about 1 month. In the foothills, a rig move can take 4-6 months because the rig must be disassembled.
Lost circulation is a problem in the region. Sawdust and bits of rubber are two solutions to lost circulation problems.
Air drilling has not been used, nor has horizontal drilling.
The association told the delegation western companies are needed to help develop problem fields. There are some undrilled prospects in the middle and southern parts of the area and it's possible a concession with additional acreage around the development prospect might be negotiated.
NORTHEAST REGION
Small reservoirs north and east of the Caspian also were presented by the Soviets to the delegation to consider as joint venture candidates.
There are 10-12 deposits in the area, but oil volumes are small and the crude is heavy. Zones at depths from 500 to 1,000 m typically contain oil with a viscosity in the 300 1,000 cp range.
Representatives of several western firms have visited the area and discussed possible ventures, according to a Soviet spokesman, and more were expected in early summer.
Copyright 1990 Oil & Gas Journal. All Rights Reserved.