High risk brings ample rewards
Judy Maksoud
International Editor
Money continues to pour into West Africa. The region has tremendous potential, and improved stability in some of the most prospective regions is making investment in the region more secure. West Africa will see one of the largest increases in capital expen-diture over the next four years.
Morocco
Vanco is making good on its West Africa drilling obligations for 2004. Vanco Morocco Ltd. signed a participation agreement with ENI Morocco BV to begin drilling its first deepwater well in its Ras Tafelney exploration permit offshore Morocco.
The Saipem 10,000 drillship will drill the Shark B prospect 130 km off the Moroccan coast in 2,120-m water depth. The drillship was due on site in late April.
While Vanco begins exploration drilling, Petronas Carigali Overseas Sdn. Bhd. has contracted with Onarep for a deepwater block in the Rabat-Sale Haute Mer area. The block covers 14,000 sq km and is in 1,000-4,000 m of water.
Under the agreement, Petronas will acquire and process 2,000 km of 2D seismic data and will drill one exploration well in the initial three-year period. Subsequently, the company will acquire and process 1,000 km of new 2D seismic data and drill another exploration well in the first extension period of two years. A third 2D survey of 1,000 km will follow in the second extension period, with an additional exploration well.
Mauritania
Activity offshore Mauritania continues to focus on the Chinguetti oil field. The PSC Area B joint venture declared the Chinguetti field commercial early this year. The decision is a milestone toward making a final investment decision and beginning to award contracts by mid-2004. Woodside Petroleum plans to bring the field into production by late 2005 or early 2006.
Exploration news centers on Dana Petro-leum's deepwater Pelican-1 well on block 7, 150 km north of Chinguetti. Results on Pelican-1, released in late March 2004, indicate the presence of two significant gas accumulations below 11,000 ft. Preliminary calculations suggest the structure holds 1 tcf of gas, 600-800 bcf of which would be recoverable, along with 10-13 MMbbl of associated liquids.
Pelican-1 is the first step in an extensive exploration program.
Equatorial Guinea
Development continues on Ceiba. Late last year, Triton Equatorial Guinea awarded Stolt Offshore a contract for work on Phase III of the Ceiba field development project. Stolt will transport and install a utility deck module for the Ceiba FPSO and will install two electric subsea pumps, rigid spools, and umbilicals for the C-3 and C-4 subsea wells at a depth grater than 800 m.
Last February, Amerada Hess Corp. drilled well G-13-2 in block G in the Rio Muni basin, confirming the G-13 discovery made in November 2002. New wells are likely in blocks F and G.
Marathon announced wildcat Bococo 1 in block D and wants to develop the gas discovery as a satellite to the Alba field. Marathon will continue drilling in its Alba block and in block D.
Côte d'Ivoire
The drilling phase of Canadian Natural Resources' East Espoir development concluded with the completion of the fifth Espoir production well, which went into full produc-tion on Sept. 6, 2003. Espoir is now producing 26,700 b/d gross.
The West Espoir development project was sanctioned late last year. First oil is expected during 2Q 2005.
Nigeria
Agip is moving its exploration program forward in OML 116 with the high-pressure high-temperature (HP/HT) Agbara Deep well. Other HP/HT prospects on the shelf will be drilled in 2004.
ChevronTexaco's appraisal well Aparo 3 proved the extension of the Bonga Southwest/ Aparo structure into OPL 249, confirming a unitized development of the accumulation, which could hold as much as 1 Bbbl of recoverable reserves.
The company's wildcat Nsiko-1 well, 25 km southwest of Bonga, was drilled to a total depth of 13,968 ft, discovering hydrocarbon pay in multiple zones. Appraisal drilling on the discovery was planned for the first half of 2004.
ChevronTexaco also saw positive results from an appraisal well drilled on the Aparo field in OPL 249. The well, drilled in 4,270 ft of water to a total depth of 12,000 ft, encountered substantial amounts of net oil sand. The results from the Aparo-3 well indicate OPL 249 Aparo, OPL 213 Aparo, and oil mining lease (OML) 118 Bonga SW share a common structure. This could lead to joint oil development.
Further south, ChevronTexaco Corp. affiliate Chevron Petroleum Nigeria Ltd. reported a significant extension of the Usan field discovery in deepwater OPL 222.
Two zones were tested in the Usan-4 well and flowed at 4,400 and 6,300 b/d under restricted flow conditions. Usan-4 has confirmed the presence of commercial quantities of oil, as well as additional potential in previously untested reservoirs.
Nigerian National Petroleum Corp. (NNPC) is concessionaire for OPL 222 under a production-sharing contract operated by the Nigerian subsidiary of Total Elf Petroleum Nigeria Ltd., a 20% stakeholder in the field.
In OPL 216, ChevronTexaco and partners completed appraisal well Agbami 5, announcing field development for 2004.
ExxonMobil drilled well Bosi 3 in OPL 209 and tested an oil rim around the Bosi gas find. The well is considered successful enough to allow development of Bosi independently of nearby Erha, where the company intends one or more appraisals in 2004.
São Tomé & Príncipe
Bids closed in late October 2003 for the blocks on offer in the Nigeria-São Tomé & Príncipe Joint Development Zone (JDZ). Nine blocks were let in the deep offshore Gulf of Guinea. Twenty-three US and Nigerian oil companies submitted 33 bids totaling over $500 million for the blocks.
The winners were expected to be announced late last year or in early January, but awards were delayed to allow ExxonMobil, and Nigeria's Chrome Energy to exercise preferential rights that were allocated before the JDZ was formed. ExxonMobil reportedly opted to take 40% of block One, which was the top pick of the round.
Exxon has an option to take up to 25% stakes in two more blocks. And Chrome Energy will have the choice of exercising its option to buy stakes in up to six of the blocks.
Block allocations were expected in March, but as of time of publication, awards had not been made.
Gabon
Another well hit oil off Gabon early this year. The wildcat well Ebouri No. 1, 11 km northwest of the Etame field, and its associated horizontal sidetrack were successfully taken to total depth, delineating an oil accumulation on the eastern flank of the prospect. Either a second well or a further sidetrack from EBO-1 will be necessary to fully delineate the Ebouri prospect.
If the prospect contains commercial quantities of oil, it will probably be tied back over the course of 2004 to the existing FPSO.
Vaalco Gabon Etame Inc. operates the Etame field.
Last March, Tullow Gabon Ltd. signed a PSC with the Gabonese government for the 5,442-sq-km shallow-water Kiarsseny Marin area in the Northern Gabon offshore basin. Three small discoveries have been made on the Kiarsseny Marin concession.
Tullow plans to continue with a comprehensive exploration program for this pros-pective license area. The license covers a large area, much of which has never been drilled.
Angola
Angola has seen activity of every sort recently.
Late last year, Sonangol and BP announced the Marte oil discovery in ultra-deepwater block 31. This is the fourth exploration well BP has drilled in block 31 and the third successful discovery following the Plutão and Saturno discoveries, which lie 20-25 km from Marte. BP planned to drill the Vénus-1 well in the area before year-end.
Marte-1 was drilled in 2,000-m water depth 175 km off the Angolan coast and reached a total depth of 4,193 m. It flowed at 5,200 b/d during testing.
BP operates block 31 with 26.67% interest.
The Total-operated Jasmim field in block 17 came onstream in early December. Jasmim is one of 15 discoveries announced in block 17 and the second to be brought on stream following Girassol in December 2001. The field lies in 1,400 m of water 150 km offshore, and its development includes eight subsea wells tied back to the Girassol production ship 5 km away.
Bringing this field onstream increases output from the Girassol FPSO to more than 230,000 b/d. It also extends plateau production from the area and forms part of Total's strategy for increased output from block 17.
The Xikomba field also began production in early December 2003. ExxonMobil Corp. subsidiary Esso Exploration Angola (block 15) Ltd. began the company's first production on block 15. Xikomba represents the first of several anticipated operated production facilities offshore Angola.
In the northwest corner of Angola block 15, Xikomba employs an early production system (EPS) consisting of nine subsea wells tied back to an FPSO. Xikomba is the third deployment of ExxonMobil's EPS technology offshore West Africa and the first EPS offshore Angola.
Not all of the recent wells have been successful, but the prospectivity of Angola's offshore will keep leaseholders busy.
Canadian Natural Resources subsidiary CNR Ranger (Angola) Ltd. drilled the first of several potential exploration targets on block 16.
Zenza-1, drilled in 1,300 m of water, reached a total depth of 3,998 m, encountering reservoir quality sands in four zones. Though the well was plugged and abandoned as a result of non-commercial hydrocarbon shows, the group plans a second exploratory well in the same block late this year or early next.
South Africa
South Africa's offshore Orange basin has seen some activity, with Forest Oil completing wells A-AA 2, A-X1 in block 2A.
A non-exclusive 2D survey off the west coast acquired by PGS has confirmed the viability of speculative plays previously envisaged in deeper water and has revealed new information that positively impacts prospectivity, though no drilling is planned.
As far as projects go, there is hope that Ibhubezi off the southwestern coast will move forward this year.
Tanzania
Late last year, Aminex PLC announced a strategic partnership for developing its Tanzania interests. Aminex's Tanzanian subsidiary Ndovu Resources Ltd. signed a farm-in agreement with Romania's state oil company Petrom SA.
Australia's Bounty Oil & Gas, meanwhile, continues drilling at Nyuni-1. Activity was suspended in March while preparations where made for sidetracking. Preliminary logging identified gas sands, and Bounty anticipates an oil-prone section could contain reservoir quality sandstones. The oil traces identified in Nyuni-1 are potentially a milestone for the whole region ;
Emerging areas
Guinea Bissau
Last December, Premier Oil reached agreement with Occidental Petroleum Corp. to farm out 40% of its 100% paying interest in blocks 2, 4A, and 5A offshore Guinea Bissau.
Premier and Occidental were jointly granted two new licenses covering blocks 7B and 7C. Premier, as operator, has a 25% interest. Occidental holds a 75% share. The partners plan to acquire a 2D seismic survey in 2004.
Republic of Guinea
In late March, HyperDynamics Corp. subsidiary SCS Corp. completed reprocessing previously gathered seismic data. SCS also acquired and processed 5,000 km of digital long-array data on the Republic of Guinea's offshore. Results indicate there are four highly prospective trends in the region, and the existence of gas is now confirmed. This new data could bring more activity to the area.
Sierra Leone
Australia's Woodside Petroleum extended its focus in Africa through an agreement to earn a 50% interest in two deepwater exploration areas off Sierra Leone owned and operated by Spain's Repsol YPF.
During the initial phase of exploration up until 2007, Woodside Energy Ltd. will pay half the costs of obtaining seismic data and will interpret this information.
Repsol intends to gather more than 3,000 sq km of 3D seismic data this year.
Liberia
In early February, the National Oil Co. of Liberia (Nocal) released the details for the country's 2004 offshore bid round, which will close Nov. 1. The round includes 17 exploration blocks, covering 55,000 sq km, of which six blocks will be awarded. Bids will be accepted on individual or multiple blocks by individual companies or as part of joint efforts.
TGS-Nopec acquired 9,000 km of 2D seismic data and will provide well information and regional interpretations to interested parties.
Nocal planned to allow direct negotiations through March. Conferences to be held in London and Houston in April were organized to provide materials for potential bidders, including petroleum laws, production-sharing contract information, tax laws, and all of the technical information available at that time.
Cameroon
Cameroon's first well in the offshore Ebodje block came up dry. The Ebodje block in the Douala basin offshore Kribi borders Equatorial Guinea, where the Ceiba project is moving into development.
Perenco operates the block with 30% interest. Partners are ExxonMobil with 45% and Cameroon's national oil company Société Nationale des Hydrocarbures (25%).
This disappointment will influence exploration in the area.
Namibia
Though there is an enormous amount of acreage open offshore Namibia, there has not been much activity. Vanco Energy has reportedly made plans to drill a well in the Namibe basin this year, but to date, there has been no activity.
