AUSSIE OPERATORS CHALK UP MORE OFFSHORE STRIKES

Australian explorationists continue to chalk up strikes offshore.

A gas discovery by West Australia Petroleum Pty. Ltd. (Wapet) off Northwest Australia near an earlier appraisal well that yielded Australia's biggest hydrocarbon flow rate augurs well for expansion of the country's liquefied natural gas export industry.

A group led by BHP Petroleum Pty. Ltd. gauged a 9,000 b/d flow at another wildcat in the Timor Sea Zone of Cooperation Area (ZOCA) established by Australia and Indonesia. In addition, BHP's appraisal of another discovery on the same block flowed 7,500 b/d on test.

Meanwhile, despite some concerns about the legality of the Timor Gap treaty established to create ZOCA, officials said the treaty will be upheld by an international court and commercial production will begin there early in 1995.

Elsewhere off Australia, Western Mining Corp. Ltd. (WMC), Melbourne, disclosed plans for a $250 million (Australian) development of East Spar gas/condensate field off Western Australia.

GAS FIND

Wapet at presstime still was evaluating what major interest holder Chevron Corp. described as a major natural gas field discovery at its 1 Chrysaor wildcat.

The find flanks Wapet's 2 North Gorgon appraisal well, which recently flowed at a combined rate of 175 MMcfd of gas from four zones (OGJ, Nov. 21, 1994, p. 36). The 2 North Gorgon further delineates the giant Gorgon structure discovered in the early 1980s that was not developed for lack of gas market.

Chevron Overseas Petroleum Inc. Pres. Dick Matzke said, "These fields hold trillions of cubic feet of gas and could ultimately be as big as North Rankin."

Giant North Rankin field is the centerpiece of Australia's Northwest Shelf LNG export project. Chevron holds a 28.6% interest in Wapet and a 16.7% interest in the Northwest Shelf project.

"Fields like Chrysaor and Gorgon, just 150 km from North Rankin, eventually could help supply the long term needs of the rapidly growing Asian LNG market," Matzke said.

TIMOR GAP STRIKE

Where BHP Group Is Exploring For Oil, Gas In Timor Gap Area (14662 bytes)

BHP added to its impressive portfolio of strikes on ZOCA Permit 91-12.

Its 1 Kakatua wildcat flowed 9,000 b/d of 530 gravity oil through a 111/64 in. choke from an 18 m perforated zone over a gross interval of 24 m. Logs indicate a gross hydrocarbon column of about 30 m containing several distinct sands. The well was drilled to 3,277 m.

Further evaluation of the Kakatua production test is planned, and more drilling is scheduled on ZOCA 91-12 in 1995.

The discovery lies 15 km west of the group's Elang oil discovery made on the same permit in February 1994 (OGJ, Mar. 7, 1994, p. 30).

It also is 55 km southeast of the Woodside Petroleum Group Pty. Ltd.'s Laminaria oil discovery in the Western Australian sector on the Timor Sea this year that flowed 7,500 b/d and 5,900 b/d, respectively, on separate tests of two shallow zones and one deeper zone.

Interest owners in the permit in Area A of the Zone of Cooperation established by treaty between Australia and Indonesia are BHP 42.417%, Santos Ltd. 21.426%, Inpex Sahul 21.209%, and Petroz NL 14.948%.

TIMOR APPRAISAL

BHP and partners completed testing the 2 Elang appraisal well in the Timor Gap area.

A second test flowed 7,500 b/d of 550 gravity oil with a gas:oil ratio of 560:1 through a 40/64 in. choke from 3,023-33 m. In early November, a lower sand in the well flowed a total of 6,080 b/d of oil (OGJ, Nov. 21, 1994, p. 39). The 1 Elang discovery well flowed 5,800 b/d.

The appraisal well, which confirms the Elang discovery, has been suspended as a potential oil producer.

Interpretation of a recent 3D seismic survey over the field and other structures on trend with it is under way. A third well, 3 Elang, is expected to spud during first half 1995.

Elsewhere off Australia, BHP plugged the 2 Pyrenees appraisal well on the Northwest Shelf after sampling gas and mud filtrate. It was a followup to a 1993 oil and gas discovery.

TIMOR GAP PRODUCTION?

Indonesia's Minister of Mines and Energy Ida Bagus Sudjana told a press conference in Jakarta last month commercial oil production will begin in the Timor Ga area ear this year.

Sudjana, along with other officials from Indonesia and Australia, was attending the fifth ministerial council meeting of the Timor Gap Zone of Cooperation treaty.

Sudjana said the Elang block in Zone A of ZOCA is estimated to hold 50 million bbl of oil reserves. He also said the field could produce 17,170 b/d of oil from three wells that have been drilled. As many as 23 wells would figure into development, the minister said. However, commercial development must await results from 1 Kakatua, still being evaluated, and 1 Sikatin, also planned for the Elang area, he noted.

Eleven contracts have been awarded for exploration in Zone A (see map, OGJ, Jan. 4, 1993, p. 26).

BHP reportedly told a press conference it was likely Kakatua and Elang would be developed in tandem, probably with a floating production and storage vessel.

TREATY CONCERNS

After the Jakarta ZOCA treaty ministerial meeting Australian Minister for Resources David Beddall told a press conference his country is confident the International Court of Justice, Hague, will uphold the treaty when it rules in January or February.

The treaty earlier passed muster with Australia's High Court.

At issue is a claim by Portugal that disputes the validity of the treaty. The United Nations currently recognizes Portugal as the legal administrative power of the enclave of East Timor. Indonesia invaded and annexed the former Portuguese colony in 1975. About 30 countries recognize Indonesia as the sovereign power there.

Australia and Indonesia hammered out the ZOCA treaty in 1989, which divided 60,000 sq km of disputed territorial waters claimed by the two nations into three areas for oil and gas exploration rights. In Zones B and C, Australia and Indonesia each, respectively, hold sole rights. Government takes from Zone A, the scene of most of the current exploratory interest, are to be shared 50-50 by the two nations.

When exploration rights were awarded to groups representing 19 companies in 1991-92, the groups committed to spending $362 million to conduct seismic surveys and drill 45 wells during 6 years in ZOCA Area A.

After the treaty was signed, Portugal pressed its case in international courts.

EAST SPAR DEVELOPMENT

WMC's proposal to develop East Spar in the Carnarvon basin, 55 km west of Barrow Island, hinges on a green light for a proposed 1,400 km natural gas pipeline to link gas fields in the area with gold and nickel mining operations near Kalgoorlie in Western Australia's central southern region.

WMC said it plans to develop the field with an unmanned tripod platform. Production is estimated at 100 MMcfd of gas and more than 3,000 b/d of condensate.

WMC is a partner in the gold/nickel mines pipeline proposal as well as the biggest potential customer for gas to be used in its nickel and gold mines at Kalgoorlie, Mount Keith, Leinster, and Kambalda.

WMC operates and holds a 30% interest in East Spar. Other interests in the gas/condensate field are Ampolex Ltd. 35%, Hadson Energy (Apache) 20%, and Bridge Oil NL 15%.

Interest holders with WMC 66.28% in the Goldfields Gas Transmission joint venture pipeline project, with corresponding rights to line capacity, are Normandy Poseidon 25% and BHP 8.72%.

BHP has reserved its share for the Mount Newman iron ore mine in the Pilbara region near the beginning of the proposed pipeline route. It hopes to supply gas for the mine from its Macedon offshore gas field, about 125 km southwest of East Spar. Macedon is thought to hold considerably larger reserves, with original gas in place pegged at 2 tcf, while East Spar recoverable reserves are estimated at 350 bcf.

The Western Australian government is expected to make its decision on the project by the end of February.