BG revises upwards resource estimates off Brazil

BG Group raised its estimate of economically recoverable gross resources by 2.7 billion boe for Tupi, Iracema, and Guara fields in the Santos basin, off Brazil. Its new estimate is 10.8 billion boe compared with 8.1 billion boe previously.

By OGJ editors
HOUSTON, Nov. 3
-- BG Group raised its estimate of economically recoverable gross resources by 2.7 billion boe for Tupi, Iracema, and Guara fields in the Santos basin, off Brazil. Its new estimate is 10.8 billion boe compared with 8.1 billion boe previously.

The company's current best estimate is 7.34 billion boe for Tupi, 1.65 billion boe for Iracema, and 1.76 billion boe for Guara.

BG defines resources as the aggregate of proved and probable reserves and discovered resources.

The company said it based its latest analysis on new and more sophisticated reservoir models that have assimilated and interpreted substantial amounts of information (much of it new and gathered over the last year) including:

• 3,200 sq km of 3D seismic.

• Results from nine completed wells, including the two original discovery wells on Tupi and Guara.

• 10 drillstem tests.

• Detailed insights gained from the Tupi extended well test, which has produced 7.6 million boe to date.

BG also engaged the oil and gas consulting firm Miller & Lents Ltd. to provide expert independent verification of the Tupi, Iracema, and Guara resource estimates.

The company noted that work continues on bringing these resources on stream such as:

• Start of production in October from the first permanent floating production, storage, and offloading vessel on Tupi (OGJ Online, Oct. 28, 2010).

• Orders for two additional FPSOs for Tupi and Guara.

• Negotiations on deploying additional production modules on Tupi, Iracema, and Guara.

• Completion of the gas export pipeline to the shallow-water Mexilhao platform.

BG has a 25% interest in Tupi and Iracema fields on Block BM-S-11 and the remaining interest is held by the operator Petroleo Brasileiro SA (Petrobras) 65%, and Petrogal 10%.

For Guara field on Block BM-S-9, BG has a 30% interest and the remaining interest is held by operator Petrobras 45%, and Repsol-YPF SA 25%.

Subsequent to BG's estimates, Petrobras inferred that BG's revisions were premature. Petrobras believes that the revised estimates should be made after completing the wells currently being drilled in the Tupi evaluation plan area and the drilling of additional delineations wells and an extended well test on Guara.

Petrobras therefore reiterated its previously disclosed recoverable oil estimates of 5-8 billion bbl for Tupi and Iracema and 1.1-2 billion bbl for Guara.

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