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Wood Mackenzie: East Africa’s Yet-to-Find Reserves Hold 95 tcf of Gas

Wood Mackenzie: East Africa’s Yet-to-Find Reserves Hold 95 tcf of Gas| Offshore Energy Today

Wood Mackenzie estimates that 100 trillion cubic feet (tcf) of gas has been discovered in Mozambique and Tanzania to date, ranking the Rovuma Basin as one of the most prolific conventional gas plays in the world.

However, there are significant technical and commercial challenges to be overcome in order to bring the gas to market by the end of this decade. These include: addressing issues around infrastructure, government capacity, financing and reaching a positive outcome to unitisation negotiations in Mozambique.

Recent discoveries and high profile M&A activity in Mozambique and Tanzania are attracting attention and Martin Kelly, Wood Mackenzie’s Head of Sub-Sahara Upstream Research, says the interest is justified: “100 tcf of gas has been discovered to date in East Africa and we estimate yet-to-find reserves could be as much as 80 tcf in Mozambique and 15 tcf in Tanzania. There is clearly plenty of gas to supply the likely commercialisation route of LNG – theoretically enough to support up to 16 LNG trains.

“The Rovuma basin is the most prolific in the region, and one of the hottest conventional gas plays in the world, with 85 tcf discovered so far. Globally in 2011, it yielded the third most hydrocarbons, and we expect it to top the list in 2012 if the first half of the year is anything to go by,” Kelly continues.

In neighbouring Tanzania, the targets are the northern extension of the Rovuma Basin and the Mafia Basin. Kelly says: “Tanzania has enjoyed considerable exploration success as well, but hasn’t discovered the same scale of reserves. The average discovery size is much smaller at around 2 tcf, compared to Mozambique which is over 7 tcf. Discoveries in Tanzania are also more spread out, so developing them will be more expensive than those in Mozambique because additional infrastructure will be required.”

One of the most immediate challenges for Mozambique, is the unitisation discussions which Wood Mackenzie understands have already begun. Kelly explains; “Of the 85 tcf of gas discovered to date in Mozambique, around half of it is thought to be one enormous field which is in communication across the block. Under Mozambican law, a unitisation agreement between the operating parties will be required.”

Although there is a risk that unitisation discussions could delay Final Investment Decision (FID) – the crucial last step before commercial development – and therefore LNG production, there are other discoveries which are wholly contained in Area 1 and Area 4 and therefore gas could come from these first.

Giles Farrer, Senior LNG research analyst for Wood Mackenzie comments: “Many challenges will need to be overcome prior to LNG project sanction. The region’s remoteness and lack of development present serious technical obstacles. There is virtually no existing skilled workforce and both Mozambique and Tanzania will have to build and establish deepwater ports capable of servicing the needs of the petroleum sector. On the commercial side, there is the question of government capacity – whether there is sufficient impetus and capability within the governments and national oil companies to advance the huge legislative, bureaucratic, customs and financial challenges that such a development would bring.

“The major outstanding milestone for Mozambique is the conclusion of a commercial framework agreement, which is in the process of being negotiated. It will determine how the LNG facility or facilities will be structured for the purpose of taxation and whether the Joint Ventures (JVs) will co-operate in the construction of a single, mega LNG facility, or pursue individual developments. One crucial advantage that the Tanzanian projects enjoy is that they have already negotiated commercial terms, prior to the announcement of their projects.”

Farrer continues: “Lastly there is the question of finance, we estimate that a two train greenfield development in the region is going to cost at least US$25 billion, and for some of the players involved financing their share of this sort of development cost will certainly prove challenging and could delay development.”

The joint analysis by Wood Mackenzie’s upstream and LNG research teams stresses that these challenges are not insurmountable. “They have been encountered and overcome in several countries before. The risk is that delays could lengthen development schedules and add to costs,” Farrer says in closing.

Wood Mackenzie: East Africa’s Yet-to-Find Reserves Hold 95 tcf of Gas| Offshore Energy Today.

Recap: Worldwide Field Development News (May 18 – May 24, 2012)

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This week the SubseaIQ team added 5 new projects and updated 33 projects. You can see all the updates made over any time period via the Project Update History search. The latest offshore field develoment news and activities are listed below for your convenience.

N. America – Mexico
McDermott to Build, Install Ayatsil Platform
May 23, 2012 – McDermott International has received a contract for the new Ayatsil-B drilling platform for PEMEX in the Bay of Campeche Ayatsil field. McDermott will undertake the engineering, procurement, fabrication, pre-commissioning, load-out and sea fastening of the Ayatsil-B eight-leg jacket and deck, weighing about 11,650 tonnes for installation in waters 377 feet (115 meters) deep. McDermott will also carry out transportation and installation analysis of the structures, and will conduct training for Pemex personnel for the facility operation and maintenance. At peak, more than 500 personnel will be engaged on the project. Completion is expected during the third quarter of 2013.
Project Details: Ayatsil
Africa – Other
Anadarko Finds Major Gas Accumulation in Rovuma Basin
May 22, 2012 – Anadarko Petroleum has discovered a major natural gas accumulation in the Golfinho exploration well offshore Area 1 of the Rovuma Basin. The Golfinho discovery well encountered more than 193 net feet (59 net meters) of natural gas pay in two high-quality Oligocene fan systems that are age-equivalent to, but geologically distinct from, the previous discoveries in the Prosperidade complex. “The Golfinho discovery, which is entirely contained within the Offshore Area 1 block, adds an estimated 7 to 20-plus Tcf of incremental recoverable resources over a significant areal extent. This new discovery is only 10 miles offshore, providing potential cost advantages for future development options,” stated Anadarko. The Golfinho exploration well was drilled to a total depth of approximately 14,885 feet (4,537 meters), in water depths of approximately 3,370 feet (1,027 meters). Once operations are complete at Golfinho, the partnership plans to mobilize the Belford Dolphin (UDW drillship) to drill the Atum-1 exploration well.
Project Details: Golfinho (Anadarko)
Australia
AWE Identifies Potential Prospects in Tui Area
May 23, 2012 – Pan Pacific Petroleum, a partner on the Tui field, reported that the joint venture has further progressed evaluation of the Tui Area upside and has identified two potential development infill opportunities and two prospects, which are currently being further matured to enable the JV to decide on possible drilling plans. Subject to approval and rig availability, drilling is planned for 4Q 2012 – 1Q 2013.
Project Details: Tui
Oilex Plans to Drill Bazertete, Tutuala Prospects by Year-End
May 23, 2012 – Oilex has finalized evaluation of the Bazartete and Tutuala prospects which have both emerged as attractive drilling candidates, according to the company. The Bazartete prospect has been selected by the Joint Venture participants as the third commitment well based on an assessment of a higher chance of success than Tutuala and proximity to potential oil charge modeled from the southern part of the contract area based on offset well calibration. Oilex estimates mean recoverable resources for Bazartete (within JPDA06-103) of 65 MMbbls with an upside of 164 MMbbls. Subject to rig availability, drilling is targeted for 3Q 2012.
Project Details: Tutuala
Africa – West
Chariot Secures Rig to Drill Nimrod Prospect
May 21, 2012 – Chariot Oil & Gas Limited and partners have reached an agreement with Ocean Rig UDW to use the Ocean Rig Poseidon (UDW drillship) to drill the Kabelijou (2714/6-1) well at the Nimrod prospect. The Poseidon, which is currently on a long-term contract with the operator, is anticipated to arrive on location in July 2012. Drilling operations will commence shortly thereafter. The Nimrod prospect is located in the Orange Basin in Southern Block 2714A where Chariot has a 25 percent equity interest. The Kabeljou well is expected to take approximately two months to drill. The drilling location is 48 miles (77 kilometers) offshore Namibia in 1,181 feet (360 meters) of water with an estimated total drilling depth of 10,171 feet (3,100 meters).
Project Details: Nimrod
Asia – SouthEast
AWE Ready to Spin Bit at Atlas Prospect
May 23, 2012 – AWE reported it is ready to start drilling the Atlas-1 well in May 2012. The prospect is targeting a large gas opportunity in East Java Basin, and if successful, will provide ongoing prospects for further exploration.
Project Details: Atlas
Premier Reviewing Commercial Potential of CRD Discovery
May 23, 2012 – Premier has completed an extensive assessment of exploration opportunities remaining in Block 07/03 and of the commercial potential of the CRD oil and gas/condensate discovery, including whether additional appraisal drilling is required. The JV participants are considering future drilling plans based on the results of this work. At least one exploration well is required to be drilled as a commitment well prior to the end of November 2013.
Project Details: Ca Rong Do (CRD)
Premier Oil Moves Forward with Dua Development
May 21, 2012 – Premier Oil announced that the Dua project, a tie-in to the Chim Sao field, was formally sanctioned by Premier and Santos in April. It is expected that the necessary Vietnamese government approvals will be received during the second quarter of 2012. In the meantime, bids for FPSO modifications and the drilling rig have been received and are being evaluated. Premier continues to target 2014 for first oil.
Project Details: Chim Sao
Otto Energy Updates Galoc Oil Reserves
May 21, 2012 – Otto Energy provided an update on remaining oil reserves balances at the Galoc oil field in the Philippines, performed by independent consulting firm RISC. The company confirmed the reported increase in reserves is attributable to better than expected reservoir performance to date and an extension of field life due to higher prevailing oil prices. Galoc is expected to remain in production until 2016 to 2018 on the basis of the existing two wells alone. Otto Energy estimates Contingent Resources of 1.49 MMboe (Otto share) at 2C level attributable to the Galoc Phase II development, currently progressing through Front End Engineering and Design, with a target Final Investment Decision around mid-2012.
Project Details: Galoc
Black Sea
Sterling Resources to Drill in Black Sea
May 24, 2012 – Sterling Resources and partners intend to drill two offshore prospects in the Romanian sector of the Black Sea by year-end. The first of the two wells to be drilled will be the Ioana prospect, located in the gas-prone Midia Block, directly northeast of the Ana and Doina discoveries. Following drilling of the Ioana well, the jackup will be relocated to the Eugenia prospect in the Pelican Block.
Project Details: Ioana
Asia – Far East
CNOOC Finds Oil in Liaodong Bay
May 24, 2012 – CNOOC Limited has made a discovery in the Luda (LD) 21-2 prospect in the Bohai Bay. LD 21-2 is located in the inverted structure belt of LD 22-27 in south Liaodong Bay, with its south part adjacent to the LD 27-2 oilfield. The average water depth is 66 feet (20 meters). The discovery well of LD 21-2-1D was drilled and completed at a depth of 9,288 feet (2,831 meters) and encountered oil pay zones with a total thickness of about 558 feet (170 meters), representing the thickest oil layers found in the exploration of Bohai clastic rocks in recent years. Currently, oil production at the Luda well tested at around 608 barrels per day.
S. America – Other & Carib.
Repsol Drills Duster at Jaguey Prospect
May 21, 2012 – Repsol failed to hit pay at the Jaguey prospect offshore Cuba and will begin operations to plug and abandon the well.
Project Details: Jaguey
S. America – Brazil
Respol Gears Up Appraisal Plans for BM-C-33 Block
May 24, 2012 – Repsol Sinopec Brazil reported that Block BM-C-33, in the deepwater Campos Basin, contains resources of more than 700 million barrels of light oil and 3 trillion cubic feet of gas. The partners are working on an appraisal plan for the area, which contains the recently discovered Seat, Gavea and Pao de Acucar fields. The latter is reportedly one of the world’s top five discoveries in 2012. The latest well, Pao de Acucar, was drilled in approximately 9,186 feet (2,800 meters) of water and 121 miles (195 kilometers) from the coast of Rio de Janeiro, and found a 1,640 foot-thick (500 meter-thick) oil column. The consortium is preparing to submit an appraisal plan for submission to ANP.
Project Details: Pao de Acucar
Wartsila Hamworthy to Deliver Inert Gas Generator Units for Tupi, Guara FPSOs
May 21, 2012 – Wartsila Hamworthy will deliver inert gas generator units to eight FPSOs in the Santos Basin. Six of the units will be deployed for the Tupi fields with the other two being utilized for the Guara field. The first two units will undergo full scale testing at the factory in Moss prior to delivery, starting as soon as the end of December this year and up to the end of January 2015. Each of the units will be installed on the utility module on the FPSO inside a dedicated compartment. The eight FPSOs are currently under construction in Brazil.
Project Details: Lula (Tupi)
Europe – North Sea
Barryroe Proves Production Potential
May 24, 2012 – Providence Resources reported that it is “dealing with a high productivity oil system” at its Barryroe discovery, offshore Ireland in the North Celtic Sea. Providence said that well test analysis at Barryroe indicates a high-permeability basal oil-bearing reservoir interval, while the firm expects horizontal development wells to deliver “significant production rates”. Data acquired by Schlumberger during well-testing operations of the 48/24-10z Barryroe well was analyzed to find an average permeability of around 400 millidarcies, confirming high permeability. The analysis forecasts that a 1000-foot (305-meter) horizontal well could deliver around 12,500 barrels of oil per day and 11 million standard cubic feet of gas per day through a standard 4.5-ince outer diameter production tubing under natural lift.
Project Details: Barryroe
Faroe Spuds Clapton
May 24, 2012 – Faroe Petroleum has commenced drilling at the Clapton prospect in the Norwegian sector of the North Sea. Clapton is a chalk prospect on the flanks of the salt induced Mode Dome. The well will target the Ekofisk, Tor and Hod formations, which are the main producing reservoirs in the neighboring fields. The well is being drilled using the Maersk Guardian (350′ ILC) jackup.
Project Details: Clapton
Total to Appraise Norvarg in 2013
May 24, 2012 – Total is preparing for an appraisal well on the Norvarg discovery for 2013. Total currently carries a resource estimate in excess of 200 million barrels of oil equivalent (mmboe). However, the resource range is wide and the need for appraisal apparent, stated the company.
Project Details: Norvarg
MPX Halts Timon Drilling Ops
May 24, 2012 – The WilHunter (UDW semisub), which is drilling the Timon exploration well in the UK sector of the North Sea, has incurred technical downtime due to equipment failure. Therefore, operations at the Timon well have been temporarily suspended and the current estimated length of downtime is roughly 18 days. A further update will be released once the semisub is able to recommence normal operations, which is expected to be in early June 2012.
Project Details: Timon
Wintershall Succesfully Appraises Maria
May 22, 2012 – Wintershall has successfully appraised the Maria well (6407/1-5 S) in the Norwegian sector of the North Sea. The purpose of the appraisal well was to delineate the Maria discovery and prove hydrocarbons in the northern extent of the structure. “Our preliminary calculations do not only confirm our original resource estimates, but support the upper end of our discovery volumes”, said Bernd Schrimpf, Managing Director of Wintershall Norge. The original Maria discovery has been estimated to contain between 60 and 120 million barrels of recoverable oil and between 2 and 5 billion standard cubic meters (sm3) of recoverable gas.
Project Details: Maria
Development Progresses at EnQuest’s Alma/Galia Project
May 21, 2012 – EnQuest reported that development of the Alma/Galia project is continuing on schedule for start-up in 4Q 2013. Batch drilling of the first three wells continues; the first of these wells is in the reservoir and on prognosis.
BG Group Updates Ops at Bream
May 21, 2012 – BG Group reported that the conceptual design of the Bream project was formally agreed among the JV partners in March and the operator has signed a FEED agreement. An invitation to tender to drill the development wells has also been issued and the JV partners anticipate achieving formal project sanction in the second half of 2012.
Project Details: Bream
Emerson to Deliver Subsea Instrumentation for Brynhild Development
May 21, 2012 – Emerson will deliver its Roxar subsea instrumentation for the Brynhild field in the North Sea. The contract was awarded by Aker Solutions and covers Roxar subsea multiphase meters, subsea Sencorr pressure and temperature sensors, subsea chemical injection valves, and sand monitors. Aker Solutions will use the instrumentation as part of the rolling out of a complete subsea production system on Brynhild, with Emerson also delivering a number of downhole pressure and temperature gauges directly to Lundin Petroleum. The Brynhild field, which is currently under development, is forecasted to produce first oil in late 2013 at a gross plateau production of 12,000 bopd.
Project Details: Brynhild (Nemo)
Premier Oil Continues with Concept Engineering, Evaluation Design on Catcher
May 21, 2012 – Premier Oil reported that concept engineering and evaluation by the JV partners of the Catcher development continues to progress. It is expected that an agreement on the conceptual design of the development will be reached in the third quarter. The operator continues to target a final investment decision around year-end and first oil in 2015.
Project Details: Catcher
Total Confirms Well Intervention at Elgin Complex
May 21, 2012 – Total has confirmed the success of the G4 well intervention at the Elgin complex. To regain control of the well, heavy mud was pumped into the G4 well from the West Phoenix (UDW semisub). The leak was stopped, stated the company. Following the success of the well intervention, the next phase will be to re-man the Elgin complex and restart the Rowan Viking (430′ ILC) drilling rig in order to set cement plugs in the G4 well. This phase, aiming at completing the plugging and permanent abandonment procedure of the G4 well, will take several weeks. Once the first cement plug is set in the G4 well by the Rowan Viking, the drilling of the ongoing relief well with the Sedco 714 (mid-water semisub) will be stopped. In consultation with the appropriate authorities, it has been decided that drilling a second relief well by the Rowan Gorilla V (400′ ILC) jackup is no longer necessary and has therefore been cancelled.
Project Details: Elgin/Franklin
E.ON to Bring Huntington Online by Year-End
May 21, 2012 – E.ON reported that progress has been made offshore on the Huntington field in the UK sector of the North Sea. The production wells drilled to date have exceeded expectations and development drilling is expected to be completed in July. The infill pipeline is now being laid and a two month installation FPSO window, commencing on September 1, has been secured. Previously announced delays to the upgrade of the FPSO have been addressed by increasing the manpower in the yard. The operator continues to forecast fourth quarter for first oil with an expected plateau production rate of 25,000 bopd.
Project Details: Huntington
N. America – US GOM
Anadarko Fails to Hit Pay in Spartacus
May 24, 2012 – Anadarko has failed to hit commercial pay in the Spartacus oil and gas prospect in the Gulf of Mexico. The well was targeting subsalt layers in the vicinity of Anadarko’s Lucius project, which is currently under development.
Project Details: Spartacus
Shell Begins Development Drilling at Cardamom
May 22, 2012 – Shell has begun development drilling at its Cardamom field in Garden Banks Block 427 using the Noble Jim Thompson (DW semisub). The rig will drill two wells, with each well taking about 90 days. Both wells will be tied-back to the Auger TLP. Shell’s DOCD for Cardamom includes drilling four development wells and permits for all wells have been approved.
Project Details: Auger
Repsol to Drill Leon Prospect in 2012
May 22, 2012 – Repsol reported it has received a drilling permit for its Leon prospect in Keathley Canyon Block 686 in the Gulf of Mexico. Drilling is scheduled to take 140 days. It is reported that the Noble Jim Day (UDW semisub) will drill the well. Leon is a subsalt prospect with a proposed total depth of just over 31,500 feet (9,601 meters) and is located in approximately 6,200 feet (1,890 meters) of water.
Project Details: Leon

Grid Petroleum Corp. — Announces Joint Venture Development Agreement for New Area of Interest

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DENVER, Feb. 21, 2012 /PRNewswire/ — Grid Petroleum Corp. (OTCBB: GRPR) The Board of Directors are pleased to announce that Grid Petroleum has entered into a Joint Venture Development Agreement with a private holding company, to develop a Mutual Area of Interest in the Northwest Premont Field in Jim Wells County Texas. The Field covers 4,500 acres and is part of the Gulf Coast Trend in South Texas.

Reserves are estimated to contain over 20 million barrels of oil (bbls) and 20 billion cubic feet (bcf) of natural gas from as many as 15 potentially productive zones per well. The initial phase of the Development Agreement outlines the drilling and completion of 20 new wells and the re-entry of 8 additional previously drilled and completed shut-in wells.

The company had previously announced negotiations to purchase the private holding company, however it has been determined a Joint Venture Development Agreement will serve the company and its shareholders more beneficially in the near term.

Grid Petroleum will begin participation with the second well to be drilled under the Joint Venture Development Agreement at a level of 10% for an investment of $152,000.

Grid has the opportunity to make the Companies first investment into the Joint Venture after the results of the first well-drilled and completed are available for analysis, greatly reducing the risk of the investment by Grid Petroleum into the entire field.

The purpose of the development of the Northwest Premont Field is to create value and income by re-entering certain wells, which have been tested and have proven oil and gas producing zones, and the drilling of strategically located wells containing multiple zone production in a manner that produces high rates of stable production; proving the reserves of the underlying pay zones for further development of the field through production.

To date the fields operator has re-entered two wells, the Guerra #2 and the Garcia #2. The Guerra #2 was drilled to 4,000 feet and tested positively for oil and gas in 12 potentially productive sand zones encountering 118 net feet of pay.

AP Yang, Petroleum Engineers of Houston Texas ran 45 days of open flow tests to draw down the pressure of each of the productive zones in the well. The absolute open flow rate calculations indicated the lobe flow of the Laughlin oil sand deposit tested at 15,541,000 cubic feet gas per day. The upper lobe flow tested at 5,063,000 cubic feet peer day. The combined total of 20,604,000 cubic feet per day from 16 feet of net pay zone for this one well with multiple pay zones.

Preliminary Reserves Estimates for the Guerra #2 are 100,000 to 150,000 Barrels of oil and 1.5 Billion Cubic Feet to 2.5 Billion Cubic Feet of natural gas.

The second re entry well the Garcia #2 is co-mingling two gas zones with production averaging 1.0 million cubic feet of gas per day. An Oil zone is also producing an average of 39 barrels of oil per day. Reserve estimates for the Garcia #2 will have similar potential production levels as the Guerra #2.

The current price of gas ranges between $2.75 and $3.00 per mcf.

20 million cubic feet per day of gas production represents a potential gross of $60,000.00 per day.

Grid Petroleum Corp is a development stage company focused on the acquisition and development of low cost high reward oil and gas prospects with infield drilling for proven potential reserves in the United States and Canada.

The company anticipates the initiation of a development plan with its joint venture partners for the purpose of establishing suitable drill sites for the Kreyenhagen Trend leases.

Upon completion the company will have established a time line for the development of its significant Oil and Gas assets.

www.gridpetroleum.com

New Terminal JV in China for Odfjell SE

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Odfjell SE has made an agreement to enter into a joint venture via its subsidiary Odfjell Terminals Asia Pte Ltd (Singapore), with Tianjin Economic-Technology Development Area (TEDA) via its subsidiary Nangang Port Company to develop a terminal and marine facilities for bulk liquid chemicals, petroleum products and gases in the Nangang Industrial Zone (Tianjin) in China.

The initial phase of the joint venture will consist of three deep sea berths and have a total storage capacity of about 150,000 cubic meters.

The joint venture company will be named Odfjell Terminals Nangang (Tianjin), whereby Odfjell will hold 49% ownership and hold the operational management. The initial total investment is estimated to be about USD 160 million. The first phase will start operations during the second quarter of 2014. The Nangang Industrial Zone is located about 120 km from Beijing and will become the major petrochemical complex in the Western Bohai Bay area

Source

USA: Total Enters Utica Shale JV with Chesapeake

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Total announced that its subsidiary, Total E&P USA, has signed and completed on December 30, 2011 an agreement to enter into a Joint Venture with Chesapeake Exploration, a subsidiary of Chesapeake Energy Corporation, and affiliates of its partner EnerVest Ltd.

In the agreement, Total acquires a 25% share in Chesapeake’s and EnerVest’s liquids-rich area of the Utica shale play located across 10 counties on the eastern side of the state of Ohio, USA.

Yves-Louis Darricarrère, President, Total Exploration & Production, stated “Total is delighted to be building on our technical successes with Chesapeake in the Barnett Shale Joint Venture and to expand into the liquids-rich Utica Shale play in Ohio. This is consistent with our strategy to develop positions in unconventional plays with large potential and, in this case, with value predominantly linked to oil price. This joint venture will provide us with a material position in a valuable long-term resource base under attractive terms and with a top-class operator. Total is conscious of the environmental aspects linked to developing shale acreage and is confident in Chesapeake’s capacity to manage the Utica shale operations in a responsible manner, respecting the highest industry standards.

The transaction is effective as of November 1, 2011. Total has paid Chesapeake and EnerVest about USD 700 million in cash for acquiring these assets. Total will also be committed to pay additional amounts up to USD 1.63 billion over a maximum period of 7 years in the form of a 60% carry of Chesapeake and EnerVest’s future capital expenditures on drilling and completion of wells within the Joint Venture.

The Joint Venture covers approximately 619,000 net acres, of which 542,000 net acres are brought by Chesapeake and 77,000 net acres are brought by EnerVest. Total will acquire its 25% share from each of Chesapeake and EnerVest on identical terms, giving a total of 155,000 net acres. Chesapeake will operate the Joint Venture acreage.

As a result of the transaction, Total will also acquire a 25% share in any new acreage which will be acquired by Chesapeake in the liquids-rich area of the Utica shale play.

To date 13 wells have been drilled across the acreage with very promising results seen from each well in terms of productivity and liquid content. The Joint Venture plans to ramp up the drilling activities in the coming 3 years with 25 rigs planned to be mobilized by 2014 to fully appraise and develop the acreage. SEC production in Total’s share is expected to reach 100,000 barrels of oil equivalent per day by the end of the decade.

Additionally, Total, Chesapeake and EnerVest have agreed to jointly develop the construction of the necessary midstream facilities to export the production from this acreage.

Source

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