BHP Billiton slows progress of deepwater exploration off Trinidad and Tobago

BHP Billiton Ltd. has pushed back the second phase of its deepwater exploration offshore Trinidad and Tobago from this year’s fourth quarter to first-quarter 2018 according to the Caribbean twin-island nation’s Energy Minister Franklyn Khan.

BHP Billiton Ltd. has pushed back the second phase of its deepwater exploration offshore Trinidad and Tobago from this year’s fourth quarter to first-quarter 2018 according to the Caribbean twin-island nation’s Energy Minister Franklyn Khan.

In an interview with OGJ, Khan said the delay was caused by the Australian outfit’s inability to secure a deepwater drillship to conduct a two-well program in the fourth quarter.

“It’s a cycle that has to do with the international industry because the contract will only have to be for two wells,” he said. Since drilling rig owners prefer long-term contracts, he said, procuring a rig for just two wells requires finding an adequate break in the rig owner’s long-term contracts.

BHP Billiton has so far drilled two wells in the previously unexplored deep water and has made a natural gas discovery with its first well, Le Clerc, and drilled a dry hole with the second well.

Geraldine Slattery, BHP’s asset president, conventional, told the Trinidad and Tobago Energy Conference that the discovery was the first in the Caribbean’s deep water. “We are very encouraged by the large potential gas resource found in the LeClerc on Block 5 with gas penetrating multiple horizons,” Slattery said.

“We are currently evaluating recoverable gas volume as well as conditions both above and below ground necessary to support the further appraisal of that potential,” Slattery said. “We were also very pleased to have oil shows in the deep of that well, a strong indication of a liquid hydrocarbon system which supports prospectivity for oil in the southern play. Testing new plays in the deepwater Caribbean and around the world has historically taken more than one well to test and we remain very optimistic of a tier one play in Trinidad and will return to drilling in financial year 2018,” sh said.

Slattery added that if the appraisal went as well, it had the potential to hit the market in the near term in the early to mid-2020s at a time when there is expected to be a gas shortfall in both LNG and in Trinidad and Tobago gas supply.

Khan said BHP was yet to appraise the well and said it is a significant gas find but the issue is whether it can cross the economic hurdle for deepwater projects.

“It is a discovery of significant gas, but remember the volumes you need to make deepwater economics it is significantly different from shallow water,” Khan told OGJ. “If that discovery was made in the shallow water, you would be good to go. I am not saying it is less than 3 tcf, but 3 tcf in the deep water can be considered marginal,” he said.

BHP has at least an additional six wildcat wells to drill in its Trinidad and Tobago deepwater program.

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