Oilman
laments T&T drilling costs
PORT SPAIN
Petroleumworldtt.com
03 02 08
Petro-Canada’s senior vice president —Operations
and Technology, International and Offshore Gordon
Carrick—said yesterday the cost of drilling
wells in T&T has increased by 400 per cent.
He said that when Petro-Canada was calculating
the economics of the production sharing contracts
for drilling eight wells, the cost was estimated
at $80 million.
However, the company now has to pay an inflated
price of $400 million to drill its wells off Tobago.
“When we were doing the bidding, we assumed
that we would drill those eight wells for $80 million.
Now it’s going to be $400 million,” he
told reporters at the T&T Petroleum Conference
at the Hilton Trinidad and Conference Centre yesterday.
Asked whether this was still profitable
for Petro-Canada, Carrick said: “Oh yes, otherwise we wouldn’t
be here. You need a big resource. The higher the
drilling cost input, the higher the cost to build
the facility, the bigger the reserve you need and
the higher the price. It’s a relatively simple
equation.”
In January, Petro-Canada announced
that its recent natural gas discovery in Block
22 offshore T&T
could contain between 0.6-1.3 trillion cubic feet
of recoverable natural gas.
It was the first well to be drilled
in Block 22 in its 6-month drilling campaign.
Petro-Canada
was awarded a production sharing contract for Block
22 in July 2005 and is operating the well in partnership
with the Petroleum Company of T&T (Petrotrin).
Petrotrin has a 10 per cent partnership while Petro-Canada
owns the remaining 90 per cent.
The news, along with the discovery
by Canada Superior on the North Coast, has inspired
optimism about
T&T’s energy future.
With regard to concern about how
the drilling is affecting the livelihood of fishermen
in Tobago,
Carrick said Petro-Canada was working with “fisherfolk” along
the Gulf of Paria and in Tobago.
He said the same approach was used
with fishermen in Canada and “we’ve established an
organisation called One Ocean where we meet with
local fishing representatives to discuss common
issues. We think that there are opportunities for
both industries—the fishing and the oil and
gas industry to use the ocean as long as we co-operate.”
With regard to tax and incentives, Carrick said
that sustainability to some extent depends on being
competitive.
“You have to think, what do we have that
will attract capital investment?” he said.
He noted that the country has large reserves and
resources but needs a complimentary fiscal regime
which will attract foreign investment.
He said the company has met with success in the
building of its organisation but faces technical
challenges.
“The drilling off the Gulf of Paria was
a difficult challenge because of high pressure,
high temperature which can happen in some reserves
around the world. Off tobago, its deep water and
high currents. Those are technical challenges we
will have to face at some point,” he said.
Story
by Asha Javeed from The Trinidad Guardian
The
Trinidad Guardian
Wednesday 27th February, 2008
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