Harken Energy Corp. has its sights set on early spudding of the first wildcat under terms of a new production sharing contract in the Persian Gulf off Bahrain.
The contract, which covers almost all of the country's off shore acreage, requires the Dallas independent to spud a wildcat to test Permian Khuff carbonate within 2 years. Harken hopes to spud this year.
The first wildcat will be drilled at Jarim reef, a seabed anomaly exposed at low tide.
The reef, about 15 miles northwest of Manama, Bahrain's capital, is a manifestation of a seismically controlled, closed anticline. Its surface expression is 6-7 miles wide and 12 miles long.
Harken is deciding whether to drill from a shallow draft jack up or dredge and build a pad for a land rig. The well, expected to go to 13,500 ft, will cost $6-8 million.
Harken is pursuing financing alternatives and an industry partner to help carry out the production sharing contract.
Bahrain National Oil Co. (Banoco) decided to look for a small company to explore the acreage and negotiated with several companies (OGJ, Jan. 29, Newsletter).
Harken plans to evaluate other leads for drilling after more geological interpretation and geophysical surveys.
GEOLOGIC SETTING
Harken's postulated structure lies on trend between Awali field, the only production in Bahraini territory, and Abu Safah field off Saudi Arabia.
Abu Safah, discovered in 1963, contained about 6 billion bbl of oil reserves in Jurassic Arab limestone at 8,000-8,500 ft and is believed to have deep Khuff potential.
Awali, with 1.5 billion bbl of original reserves and 10 tcf of gas, produces oil from Cretaceous Bahrain zone at 2,500 ft and Arab at 6,000 ft. The field's Khuff gas at 9,0001 1,000 ft is the nearest Khuff production to Harken's structure about 20 miles north.
The Cretaceous zone contains about 70% of the field's oil, but analyses have shown Cretaceous and Jurassic oils to be alike. Intense folding and fracturing of Upper Jurassic Hith anydrite is thought to have allowed Jurassic oil to escape to Cretaceous in Awali field.
Harken believes its structure to be more similar to Abu Safah than Awali because no fracturing of Hith anhydrite appears in seismic data, said Monte Swetnam, president of Harken Exploration Co., a wholly owned subsidiary of Harken Energy.
Bahrain lies east of Saudi Arabia's supergiant Ghawar field, with reserves of about 70 billion bbl of oil, and west of Qatar's North gas field, with reserves of several hundred trillion cubic feet of gas.
Awali field, discovered in 1932, was the first commercial oil strike on the Arabian side of the gulf. It currently produces about 42,000 b/d of oil and more than 500 MMcfd of gas.
CONTRACT TERMS
Harken's production sharing contract covers Muharraq Island, Umm al Nasan Island, and all offshore territory except a small area southeast of Bahrain island.
Harken may activate a 3 year final exploration term if it makes no commercial discovery during a 2 year initial exploration term. A commercial discovery triggers a 35 year contract term.
The contract gives Harken rights to its share of oil and nonassociated gas and Banoco rights to all associated gas as well as its share of oil and nonassociated gas.
Large Bahraini consumers of gas include Bahrain Petroleum Co.'s 243,000 b/d refinery on Sitra Island, aluminum and desalination plants, and other businesses. Bahrain also has a large gas processing plant.
Harken has the right to export its share of oil and expects to market any nonassociated gas in Bahrain.
Copyright 1990 Oil & Gas Journal. All Rights Reserved.