Strike off Bahrain is a big deal—but not headline-size

April 16, 2018
Forbearance, please, for breathlessness of the headlines.

Forbearance, please, for breathlessness of the headlines.

“Bahrain announces discovery of shale oil reserve estimated at 80 billion bbl,” panted one typical in the region.

To be sure, a major oil discovery off Bahrain, accompanied by two deeper-pool gas strikes, is a big deal. It’s just probably not that big.

In a report by the official Bahrain News Agency, DeGolyer & MacNaughton Senior Vice-Pres. John Hornbrook was clear.

“Oil in place of 80 billion bbl is based on a P50 resource estimate,” he said. That implies a 50% chance that the actual volume is higher than the best estimate—and the same chance it’s lower.

Reserves, the portion of the resource economically producible with available technology, will be much lower.

The reservoir is described as “tight” and sounds complex.

According to BNA, a spokesperson for Schlumberger, which handled initial drilling, said cores from several wells indicate “the formation could be classified at the edge of the conventional-unconventional type of plays.”

Yahya Alansari, chief exploration geologist of Bahrain Petroleum Co., said, “The presence of a layer with moderate conventional reservoir properties on top of an organic-rich source rock creates a unique self-sourcing and trapping mechanism.”

If the system does contain 80 billion bbl of oil, it will yield only a fraction of it.

Still, the discovery seems likely to prove larger than—and end the paradox of—Bahrain field.

Found in 1932, the oil field first known as Awali was the inaugural discovery of the Persian Gulf region—and Bahrain’s only major find until now.

State-owned Tatweer Petroleum Co. is redeveloping the field and has restored production, which peaked in 1970 at 79,000 b/d, to about 45,000 b/d.

Bahrain’s only other production is its half of 300,000 b/d from offshore Abu Safah field, shared with Saudi Arabia.

Officials of the fiscally distressed island nation hope the new field can start producing in 5 years.

Whatever the timing, headlines for that event, too, will have good reason to hyperventilate.

(From the subscription area of www.ogj.com, posted Apr. 6, 2018; author’s email: [email protected])

About the Author

Bob Tippee | Editor

Bob Tippee has been chief editor of Oil & Gas Journal since January 1999 and a member of the Journal staff since October 1977. Before joining the magazine, he worked as a reporter at the Tulsa World and served for four years as an officer in the US Air Force. A native of St. Louis, he holds a degree in journalism from the University of Tulsa.