BHP
find won’t affect latest bid round
Trinidad's
Geological Center
Trinidad's
Geological map North Shore
By Curtis Williams
The Trinidad Guardian
Port Spain
Petroleumworldtt.com
11 12 06
Last
Thursday, BHP Billiton confirmed a hydrocarbon discovery
in Block 3a in shallow waters off Trinidad’s
East coast.
The
announcement was made weeks after it was first reported
in the Business Guardian and on the same day that
the BG made available information on the testing
of the Ruby 1 well.
BHP
Billiton noted it had to drill additional wells
to confirm if the find is commercial but the present
information showed it had significant potential.
The
well is located nearly 30 miles off the northeast
coast of Trinidad in water depths of 200 feet, approximately
five miles east of the central processing platform
for the greater Angostura field, a BHP Billiton-operated
development in Block 2(c), which is adjacent to
Block 3(a).
Block
3(a) is operated by BHP Billiton, which has a 25.5
per cent interest in the field. Joint venturers
include Talisman (Trinidad Block 3a) Ltd, and Anadarko
Petroleum Corporation, each with a 25.5 per cent
interest; Petrotrin, which has a 15 per cent interest
and Total, with an 8.5 per cent interest.
The
announcement came in the middle of the latest bid
round for new blocks and two weeks after the Government
announced the new production sharing contracts.
Theodore
Taylor is both a petroleum engineer and a geologist,
explained that net pay is hydrocarbon bearing sands
which you consider to be predicable.
“Most
of the time whenever you are drilling exploration
wells they are drilled vertically. When you drill
vertically you will encounter sands in a particular
sequence,” he said.
“If
we look at the amount of pay you found in the original
wells drilled in Angostura that being Kairi 1 and
Canteen 1 which were shown to have 200 feet of net
pay (sands in which there were predicable hydrocarbons)
and compare the vertical thickness to that of the
Ruby 1 well we can say Ruby 1 extends vertically
four times as that of Canteen 1 and Kairi 1.”
Taylor
was quick to point out that the size of the reservoir
depended on a number of other factors, not the least
of which was the amount of faulting in that area.
It
is well known that the Angostura field was the first
major find off the east coast in 30 years and at
present is producing just under 40,000 barrels a
day.
Taylor
said it was near impossible to say if the find would
be commercial without further appraisal wells.
The
geologist said in determining the reservoir BHP
would have to take into account the vertical thickness,
which it already knows, how far out it extends laterally,
the porosity of the rocks which will determine how
producible the hydrocarbons are as well as the faulting
of the rocks.
“They
are operating in very complex geology and in the
oldest rocks ever produced. It is possible to have
big vertical thickness but the lateral extension
is not very large. This, however, is not usually
the case,” Taylor explained.
In
reacting to the find Prime Minister Patrick Manning
said it was an exciting development. He argued that
the Government’s intent was to increase crude
oil production to 250,000 bop/d and that would mean
more exploration and additional finds.
He
said the Government remained optimistic about T&T
as a prolific oil and gas province.
The
question is whether this discovery is likely to
lead to greater enthusiasm among the world’s
majors to place their faith in T&T and with
it their exploration dollars.
While
the latest find could encourage energy companies,
it could turn out that the terms of the new PSCs
could be too tough for them.
Helena
Innis King who is responsible for the management
of the country’s resources at the Ministry
of Energy, said the jury is out on these questions.
She
explained that interest in the shallow and deepwater
blocks which are now out for bids has been keen
with several companies purchasing data packages.
“I
don’t know if the announcement would make
much of a difference. Many people know the area
in which BHP and its partners are operating is very
complex and they are aware that BHP had made a discovery
in 2c which they later had to lower their expectations
after appraisal, so that would temper excitement
from this latest announcement,” she said.
“What I can say, however, is that interest
has always been high in these blocks.”
Innis
King felt the new PSCs—which would see the
Government’s take increase—could be
a determining factor in whether companies bid.
“I
can’t say at this time what would happen.
I don’t have a feel for it since the PSCs
have been handed out. We will wait and see.”
Energy
economist Gregory Mcguire said the announcement
may not matter because people who bidding are aware
this country is a hydrocarbon province.
He
said the significance of the find is that BHP continued
to find oil in Oligocene sands.
At
the end of the day, he said, the way the companies
view the new PSCs will determine if they bid.
The
Trinidad Guardian
Thursday 9th November, 2006
Copyright
©2006 The Trinidad Guardian. All Rights Reserved.
