Preliminary estimations indicate the field may hold between 1 and 2 trillion cubic feet of gas resources. Repsol is the operator of the block with a 53.84% stake. Petrobras holds the remaining 46.16%.
The Sagari find reinforces the potential of this area in Peru, home to the Repsol’s Kinteroni find, one of the five biggest discoveries made worldwide in 2008 and currently under accelerated development with first gas planned for the end of 2012.
Production tests carried out at depths of between 2,691 and 2,813 metres produced gas flows of 26 million cubic feet of gas with 1,200 barrels of condensate per day in one formation, and 24 million cubic feet of gas with 800 barrels of condensate per day in the other. The sum of both tests indicates about 11,000 boepd.
Repsol plans to carry out further exploration in the block once the production tests are complete.
Repsol in May presented its 2012-2016 strategic plan with ambitious growth targets based on the strengths of its exploration and production units, the company’s growth engine. The plan envisages investment of over 19 billion euros in the next five years and annual production growth of 7% to reach 500,000 barrels of oil equivalent a day in 2016. This is higher than the industry average. Repsol also plans to add six barrels of oil equivalent to reserves for every five barrels pumped during the period.
Repsol has made more than 30 oil and gas discoveries in the last five years, including five which are amongst the largest made worldwide, significantly bolstering future reserve and production growth prospects.
CGX Energy Inc. last week announced, along with its partners on the Jaguar-1 well located on the Company’s 25% owned Georgetown Petroleum Prospecting License (“PPL”), that drilling operations at the Jaguar-1 well on the Georgetown PPL, Guyana ended and the well would be plugged at a depth of 4,876 metres without reaching the primary objective in the Late Cretaceous geologic zone.
The decision to stop drilling at this point was unanimously agreed by all partners based on safety criteria and was taken after reaching a point in the well where the pressure design limits for safe operations prevented further drilling to the main objective.
Jaguar-1 was a high pressure, high temperature (HPHT) well which was spudded in February 2012 using the Atwood Beacon jack-up rig. Whilst the primary Late Cretaceous objective was not reached, samples of light oil were successfully recovered from two Late Cretaceous turbidite sands. The partners to the Georgetown PPL are Repsol Exploración S.A (15%), as operator, along with YPF Guyana Limited (30%), Tullow Oil plc (30%) and CGX Resources Inc. (25%).
Kerry Sully, President and CEO stated, “Based on hydrocarbons recovered during the drilling of Jaguar-1, CGX is confident that a new well targeting the same prospect would hold significant promise and is therefore committed to seek a re-drill utilizing a new well design.”
Commenting on the Company’s plans in the Guyana Suriname basin, Suresh Narine, Chairman, reiterated CGX’s near-term goals stating, “In addition to our commitment well on the Corentyne Block, we are planning a 3D seismic program later this fall with our ultimate goal being to commit to a rig for a three to five well program. Added to this would be the re-drill of the Late Cretaceous target addressed by the Jaguar-1 well.”
Russia’s Zarubezhneft is getting ready to begin its oil and gas exploration campaign offshore Cuba.
Songa Mecur, the semi-submersible rig to be used for the campaign, is expected to arrive to Trinidad next week, where it will undergo preparations work before setting sail to Cuban waters.
The drilling program is expected to start in November.
Zarubezhneft in 2009 signed production sharing contracts with the communist country’s oil company Cubapetroleo for two offshore blocks located in the Cuban sector of the Gulf of Mexico. In the upcoming exploration campaign the company hopes to unlock hydrocarbons hidden in Cuba’s offshore Block L.
Cuba estimates that its offshore fields hold approximately 20 billion barrels of oil, which could, once unlocked provide a major boost to its economy.
In May this year, the Spanish oil company, Repsol, after a failed attempt to discover oil in a well offshore Cuba, decided to abandon any further offshore drilling plans in the Caribbean nation’s waters.
Earlier this week, Cubapetróleo (Cupet) informed the local media that Catoche 1X well drilling offshore Cuba was unsuccessful. The well was drilled by a consortium established by Malaysia’s Petronas and Russia’s Gazprom. The consortium then released the Scarabeo 9 rig to Venezuela’s PDVSA which will try it’s luck at the Cabo de San Antonio 1x offshore well.
- Petronas, PDVSA Searching for Oil Offshore Cuba (mb50.wordpress.com)
Cuba’s state oil company, Cubapetróleo (Cupet) sent a statement to the country’s media saying that a company from Malaysia, a subsidiary of Petronas, had started drilling operations at the Catoche 1X well offshore Cuba.
The Malaysian company is using the Scarabeo 9, a 6th generation semi submersible drilling rig, for the operation. The Catoche 1X well was spudded on May 24. The rig had been under a contract with the Spanish oil major Repsol, who, following the disappointing results of its recent well, decided to scrap plans for further drilling off the Caribean country’s coast.
Cupet has said that Repsol’s failure to find oil doesn’t mean that the oil isn’t there and has added that the area has “a high potential for discovery of new hydrocarbon reserves, according to geological studies performed.”
Cuba estimates that its offshore fields hold approximately 20 billion barrels of oil, which could, once unlocked provide a major boost to the communist country’s economy.
Furthermore, the Cupet’s announcement says that once the drilling of Catoche 1X is completed the Scarabeo 9 will move to the Cabo de San Antonio 1x well, operated by Venezuela’s PDVSA.
Scarabeo 9, capable of operating in water depths of up to 3,600 meters, was built by Singapore’s Keppel specifically for drilling operations in Cuban waters.
Due to the United States trading embargo against Cuba, Repsol had to come up with a rig with almost no U.S. made parts in it, and according to Reuters, the only U.S. manufactured part on the Scarabeo 9 rig is a blowout preventer, a part that malfunctioned and caused the Deepwater Horizon disaster in the U.S. Gulf of Mexico in 2010.
Thursday, May 10, 2012 – by Staff Report
Argentine Vice President Amado Boudou on Tuesday urged US companies to invest in YPF, the nationalized oil company that Argentina recently expropriated from Spain’s Repsol … “We are very optimistic in terms of what is coming for the Argentine economy in general and the hydrocarbons sector specifically” Boudou said at a Conference on the Americas at the US State Department in Washington. Far from scaring off foreign investment because of the expropriation, the government of President Cristina Fernandez has set the framework for “excellent opportunities for those who want to invest in joint ventures and possibilities of joint work in the energy sector,” he said. The Cristina Fernandez administration is gambling that the discovery in May 2011 of a giant oilfield in Argentina’s Patagonia would be too tempting for foreign oil giants to ignore. YPF needs the know-how and the capital to fully exploit the oil fields in the south-western Nequen province, known as Vaca Muerta (Dead Cow), which according to official estimates holds 150 million barrels of oil. YPF is “open to capital and the possibility of working together with public or private companies in Argentina or abroad,” Boudou said. – Merco Press
Dominant Social Theme: Don’t cry for Argentina. It’s all under control …
Free-Market Analysis: Are Argentina’s top officials having second thoughts about their expropriation of Spain’s Argentine oil-producer? It would seem that way from the above news report via Merco Press.
If the move was as wildly destructive as people think it may have been, then this posture would tend to confirm the idea that one of the world’s more powerful and influential states is simply spinning out of control.
The results may be truly catastrophic, not just for Latin America but for the larger, struggling world.
This boom may well be ending – or certainly growing long-in-the-tooth after a decade or more.
Although the Argentine expropriation of Repsol made major shock waves, the Argentine government under President Cristina Fernandez has portrayed it as a judicious and necessary gambit.
Many other observers regardless of political affiliation have branded the move as a shallow populist one that will bring disaster to Argentina and environs.
As the predictions of damage mount, there is more speculation that Fernandez’s action may bring down not only her own government but other regional governments as well.
These predictions involve inevitably a peso devaluation that will set off a dollar-withdrawal frenzy in big regional banks. Real estate prices – radically inflated after a decade of monetary expansion – may well plunge. The results could affect large swaths of South America.
Countries that could be affected include Uruguay, Brazil, Chile and Peru among others – all countries that have pursued moderate market-based policies and have benefitted from the South American industrial and monetary boom.
Meanwhile, Repsol doesn’t seem apt to surrender. Here’s more from the article.
YPF is “open to capital and the possibility of working together with public or private companies in Argentina or abroad,” Boudou said.
Last week the Argentine president signed a bill expropriating 51% of YPF stock from Repsol, its majority shareholder, sealing a measure that has roiled the country’s trade ties with Europe.
Cristina Fernandez has argued that the move was justified because Argentina faces sharp rises in its bill for imported oil, and Repsol has failed to make agreed investments needed to expand domestic production.
In Madrid, a Repsol spokesman Tuesday said the company has warned its competitors that they will face legal action if they invest in YPF.
“The idea is to protect the assets that were confiscated in Argentina until the situation is resolved in a satisfactory way for the parties that are involved,” the spokesman said.
Conclusion: A cascading crisis in South America may still seem likely …
- Argentina: Vaca Muerta – Argentina’s oil and gas seizure poses new dilemma (mb50.wordpress.com)
- Incensed Spain threatens Argentina after YPF seizure (mb50.wordpress.com)
- Leftist economist masterminds Argentina’s YPF grab (mb50.wordpress.com)
- This Is Why President Cristina Kirchner Is Not Good For Argentina (businessinsider.com)
- Argentine Congress easily approves YPF takeover (fuelfix.com)
- BOOM: Argentine Parliament Votes To Nationalize YPF (YPF) (businessinsider.com)
- Leftist economist behind Argentina’s YPF takeover (sacbee.com)
- Argentina Backs Nationalization of YPF Oil Firm (theepochtimes.com)
- Incensed Spain threatens Argentina after YPF seizure (mb50.wordpress.com)