MORE VENEZUELAN MARGINAL FIELDS TO SEE ACTION

Venezuela's Corpoven SA, a unit of Petroloes de Venezuela SA (Pdvsa), on Nov. 1 signed the first two operating agreements with private companies chosen during the second round of bidding on reactivation of marginal oil fields.

Nine winning bids were announced last month. Alirio Parra, Venezuela's minister of energy and mines, said expected investment of $860 million during 1993-96 from the nine successful bidders should increase production in the areas to more than 140,000 b/d in the first 3 years of operation (OGJ, Oct. 18, p. 31).

Lagoven SA said it expects to recover 800 million bbl of crude oil from reactivated marginal fields in three areas it administers under the program. Lagoven last month disclosed production and investment details for contracts to be signed with winning bidders Total and Royal Dutch/Shell group. Maxus Energy Co., a third winning bidder for a Lagoven area, disclosed its plans under the program. Lagoven said it expects Total, Shell, and Maxus to spend almost a combined $4 billion during the 20 year life of their operating contracts.

Agreements with the remaining seven winning bidders are to be signed later this month. Once contracts are signed, contractor companies must conduct environmental impact studies to comply with requirements by the ministries of energy and mines and the environment.

OPERATING AGREEMENTS

An operating agreement has been signed with a group including Norcen International Ltd. 45%, Argentina's Cia. Naviera Perez Companc SA 45%, and Servicios Corod de Venezuela SA 10%.

The group will operate the Oritupano-Leona block in Anzopategui and Monagas states. The block holds 15 fields with cumulative production of 255 million bbl and remaining proved reserves estimated at 169 million bbl.

Norcen said the agreement is a 20 year operating services contract and noted the unit has considerable additional development potential. Only 63 of the 318 productive wells are in operation, and current production is about 9,000 b/d. Norcen's share is about 4,000 b/d.

The Norcen group's initial 3 year work program carries a capital commitment of $150 million. Work during the initial period will focus on production enhancement, including workovers and well repair, installation of added production facilities, and drilling. Norcen expects the initial phase to yield increased production of 15,000 b/d.

A group made up of Argentina's Tecpetrol SA, Astra, Australia's Ampolex (U.S.A.) Inc., and Chile's Sipetrol SA now has an operating agreement covering the Quiamare-La Ceiba block in Anzoategui. The block holds six fields with cumulative production of 71 million and estimated remaining reserves of 119 million bbl.

TEIKOKU OPERATIONS

Japan's Teikoku Oil Co. Ltd. was successful bidder on the Sanvi-Guere block about 300 km southeast of Caracas. It expects to sign a formal contract soon, Kyodo News Service reported.

Cumulative production from the block, which was produced during 1955-91, is about 34 million bbl.

The new area is close to the East Guarico block won by Teikoku in 1992 (OGJ, June 29, 1992, p. 40). Teikoku took over operations on the East Guarico block, also known as Unit 9, last Jan. 1. Pdvsa said Teikoku is the first Japanese company to conduct oil operations in Venezuela.

The East Guarico block was the only block operating when bidding began.

The block includes about 16 fields, and when Teikoku took over production was about 1,370 b/d from 27 wells. The block, on which oil was discovered in 1946, holds about 480 wells. Teikoku expects to spend about $400 million during the 20 year contract, drill 150-170 wells, and increase production to about 18,000 b/d.

Teikoku Oil de Venezuela CA Pres. Evanan Romero said the area's crude is 32-34 gravity, and well depths are 3,000-6,000 ft. He said eventually the company may use enhanced oil recovery, but for now it is focusing on well repair, pumping, and gas lift.

TOTAL PLANS

Total predicted incremental recovery would reach about 168 million bbl of oil from the 53,957 acre Jusepin area in northern Monagas state of eastern Venezuela.

During 1938-89, Jusepin produced about 194 million bbl of 31 gravity crude, or about 14% of original oil in place (OOIP) estimated at 1.3 billion bbl. Total forecast production at 300 b/d by the third year of activity, to climb to 43,000 b/d by the end of the 13th year of the contract.

The French company expects to invest about $39 million in the first years and about $900 million during the life of the contract.

SHELL PLANS

Shell de Venezuela plans total outlays of $1.33 billion in the West Urdaneta area of Lake Maracaibo in western Venezuela.

It estimates incremental production at 240 million bbl of oil. The 411,582 acre producing area yielded 34 million bbl of crude during 1974-93. That represents about 4% of OOIP pegged at 780 million bbl.

Shell expects initial production will reach 8,000 b/d in the first year and 47,000 b/d by the end of the 7th year of the contract. It plans to spend more than $18 million the first 3 years.

MAXUS PLANS

Maxus Energy Corp., Dallas, was successful bidder with Otepi Consultores SA on the Quiriquire block and will post a letter of credit for $34 million for its 95% stake.

Maxus expects the operating contract to be signed later this month.

The company's 3 year work commitment will start in 1994 with a study of fields that are producing 800-1,006 b/d. The program includes a 3D seismic program over potential deep prospects. Maxus plans to start a drilling program in 1995.

Maxus said the unit is on a trend with Pdvsa's El Furrial discoveries, which it said have identified about 5 billion bbl of reserves.

The company may pursue involvement with other companies.