E&P Notes (November 2021)

TotalEnergies Drills Dry Hole Offshore Suriname TotalEnergies has plugged and abandoned its Keskesi South-1 on Block 58 offshore Suriname after encountering noncommercial quantities of hydrocarbons. Keskesi South-1 was drilled about 6.2 km from the discovery well Keskesi East-1. “The first appraisal well at Keskesi was a substantial stepout designed to assess the southern extent of the feature,” said Tracey K. Henderson, senior vice president, exploration at APA, a partner in the block. “This location had the potential to confirm a very large resource in place if connected to the reservoir sands in the discovery well. However, suitable reservoir-quality sands were not developed in the Campanian target at the Keskesi South-1 location. Data gathered from the well will be used to calibrate our geologic model and inform the next steps for Keskesi appraisal.” Semisubmersible Maersk Developer has moved to the Sapakara South-1 well, where it will conduct a flow test of the previously announced appraisal success. Following the completion of the Sapakara South-1 flow test, the exploration program will continue with the spud of the Krabdagoe prospect just to the east of Keskesi. Drillship Maersk Valiant is currently drilling Bonboni, the first exploration prospect in the northern portion of Block 58. Both rigs are operated by TotalEnergies. APA Suriname holds a 50% working interest in the block, with TotalEnergies, the operator, holding the remaining 50% stake. Harbour Abandons Falklands Plan, Will Exit Basins in Brazil, Mexico Harbour Energy (formed with the merger of Premier and Chrysaor) announced it will not proceed with the Sea Lion development in the Falkland Islands. The producer will instead focus on the successful integration of Premier Oil’s assets. Sea Lion, discovered in 2010 by Rockhopper, is estimated to hold more than 500 million bbl, but development startup has been stuck in neutral. Rockhopper intends to pursue the project and will talk with other operators about participating in the wake of Harbour’s exit. Harbour also revealed plans to exit exploration license interests in the Ceará basin in Brazil and the Burgos basin in Mexico. The operator said it wants to reinvest in lower-risk opportunities in regions where the company already has a presence. Harbour is the largest UK-listed independent oil and gas producer with most of its assets located in Southeast Asia and the North Sea. BP Starts Production at Thunder Horse Expansion BP confirmed it started oil and gas production at its Thunder Horse South Phase 2 offshore expansion project in the US Gulf of Mexico. The project comprises two subsea drill centers in 6,350 ft of water. They are connected to BP’s Thunder Horse production and drilling platform by 10-in. dual flowlines and are expected to add up to 25,000 B/D of production. The scope of the expansion will see a total of eight wells brought online, adding as much as 50,000 B/D of production. “This is another significant milestone for BP, completing the delivery of our planned major projects for 2021,” said Ewan Drummond, BP senior vice president, projects, production, and operations. “This project is a great example of the type of fast-payback, high-return tieback opportunities we continue to deliver as we focus and high-grade our portfolio.” BP operates Thunder Horse with a 75% stake; ExxonMobil holds 25%. The Phase 2 expansion project is part of BP’s plans to grow its Gulf of Mexico oil and gas production to around 400,000 B/D by the middle of the decade. ReconAfrica Granted Extension in Namibia Reconnaissance Energy Africa (ReconAfrica) and its joint venture partner NAMCOR (the state oil company of Namibia) said the Ministry of Mines and Energy has granted a 1-year extension of the first renewal period to 29 January 2023, relating to the approximate 6.3-million-acre (PEL) 73 exploration license, due to the impacts of the pandemic. ReconAfrica holds a 90% interest in PEL 73 covering portions of northeast Namibia. The exploration license covers the entire Kavango sedimentary basin. Eni Achieves First Oil at Cabaça North off Angola Eni has started production from the Cabaça North development project in Block 15/06 of the Angolan deep offshore, via the Armada Olombendo FPSO vessel. The development, with an expected peak production rate in the range of 15,000 B/D, will increase and sustain the plateau of the FPSO with an overall capacity of 100,000 B/D. This is the second startup achieved by Eni Angola in 2021, after the Cuica early production achieved in July. A third startup is expected within the next few months, with the Ndungu early production in the western area of Block 15/06. Block 15/06 is operated by Eni Angola with a 36.84% share. Sonangol Pesquisa e Produção (36.84%) and SSI Fifteen Limited (26.32%) are joint venture partners. Further to Block 15/06, Eni is the operator of exploration blocks Cabinda North, Cabinda Centro, 1/14, and 28, as well as of the New Gas Consortium (NGC). In addition, Eni has stakes in the nonoperated blocks 0 (Cabinda), 3/05, 3/05A, 14, 14 K/A-IMI, and 15, and in the Angola LNG project. Gas Production at Groningen To Cease Next Year The Netherlands plans to end gas production at the large Groningen field next year, the Dutch government recently confirmed. Output at Groningen will be cut by more than 50% to 3.9 Bcm in the year through October 2022, which will be the last year of regular production. The recent runup in natural gas prices has not impacted the state’s plans. The Dutch government originally announced Groningen would shutter by mid-2022 to limit seismic risks in the region but left the possibility of emergency production in the event of extreme weather conditions from select sites. To keep these sites operational, around 1.5 Bcm of gas will be produced on a yearly basis, until a main gas storage site can be switched to the use of imported low-calorific gas instead of the high-calorific gas Groningen delivers. The government wants the conversion to happen quickly, but originally thought it would not happen until between 2025 and 2028. Discovered in 1959, the Groningen field is run by Shell and ExxonMobil joint venture NAM. BP Turns on the Taps at Matapal BP Trinidad and Tobago achieved first gas at its Matapal subsea development offshore Trinidad. The project comprises three wells which tie back into the existing Juniper platform. Matapal is located about 80 km off the southeast coast of Trinidad and approximately 8 km east of Juniper, in a water depth of 163 m. Equinor Spuds Egyptian Vulture Well off Norway Equinor has started drilling operations on the Egyptian Vulture exploration well located offshore Norway. According to well partner Longboat Energy, the drilling of the Egyptian Vulture prospect is being undertaken by Seadrill semisubmersible West Hercules. The well is expected to take up to 7 weeks to drill. The exploration probe is targeting gross mean prospective resources of 103 million BOE with further potential upside to bring the total to 208 million BOE on a gross basis. The chance of success associated with this prospect is 25% with the key risk related to reservoir quality and thickness. Longboat has gained access to a drilling program of seven exploration wells in Norway through agreements with three separate companies. Earlier, Vår Energi started drilling the Rødhette exploration well off Norway, the first in a series of seven wells where Longboat will participate as a nonoperator. SBM Secures Large FPSO Financing SBM Offshore has completed the project financing of FPSO Sepetiba for a total of $1.6 billion—the largest project financing in the company’s history. The financing was secured by a consortium of 13 international banks with insurance from Nippon Export, Investment Insurance (NEXI), and SACE SpA. China Export & Credit Insurance Corporation (Sinosure) intends to join this transaction by the end of the year and will replace a portion of the commercial banks’ commitments. Sepetiba is owned and operated by a special-purpose company owned by affiliated companies of SBM Offshore (64.5%) and its partners (35.5%). The vessel has a processing capacity of up to 180,000 B/D of oil, a water-injection capacity of 250,000 B/D, associated gas treatment capacity of 12 MMcf/D and a minimum storage capacity of 1.4 million bbl of crude oil. Sepetiba will be deployed at the Mero field in the Santos Basin offshore Brazil, 180 km offshore Rio de Janeiro. The vessel will be spread-moored in approximately 2000 m water depth. The Libra Block, where the Mero field is located, is under a production-sharing contract to a consortium (PSC) comprising operator Petrobras (40%), Shell Brasil (20%), TotalEnergies (20%), CNODC (10%), and CNOOC Limited (10%). The consortium also has the participation of state-owned Pré-Sal Petróleo SA (PPSA) as manager of the PSC.