DESIRE petroleum gets going at long last !

Just for Biswell,

Come Feb 24 2006, the article will be 8 years old.
Interesting to note the comments came before they drilled on 2D data.
Hess that is.


Falkland Islands: the last frontier
Feb. 24, 1998 The Falkland Islands have over the last years been spoken of as one of the last great unexplored tracts of highly prospective oil and gas acreage. Large reserve numbers have been bandied about recently for this virgin play, but until a significant number of wells have been drilled and oil companies have a firmer handle on the geology no-one really knows what to expect.
However, if nothing else, the hype has served its purpose in attracting a number of major oil companies and smaller independents to explore the region.
The moment of truth will probably arrive in June when the results of the first well will be known.
In Falkland's first licensing round last year, 5 tranches some 250 km north of the islands were picked up by consortia led by Amerada Hess, Shell, UK's Lasmo and Canada's International Petroleum Corp.
While the explorers are optimistic about the region's potential, caution should remain.
In the early 1990s, Vietnam was also forecast to be a great new oil province. But a number of oil companies had their fingers burnt when, by and large, oil discoveries proved to be small and gas was found in abundance.
Fortunately, with a growing economy, there was a market for the gas in Vietnam and the necessary domestic infrastructure is now being developed.
There is no such market in the Falklands. If gas is found it will be all but useless. Even a multi-tcf find would not be commercial in the short to medium term.
Oil has to be the target.
Quentin Rigby, vice-president of international exploration for Amerada, says the area is high risk. In reserves terms, he says "it is a lacustrine basin and is not as good as the North Sea. It is smaller".
Drawing parallels with the small fields off South Africa as well as parts of South America, he said: "We think we know the geology but we will probably be wrong".
The target for the first well is a Cretaceous prospect 2,750 m below the seabed which is estimated to hold 200-400 mm barrels of oil. Other nearby targets are smaller, in the 80 - 100 mm barrel range.
Mr Rigby reckons that a 100 mm barrel find could be commercial based on an FPSO development. The chances of making a commercial find are put at about one in 10.
Under a novel arrangement, the 4 tranche operators are sharing equally the cost of the drilling operations in the South Atlantic under the banner of the Falklands Offshore Sharing Agreement (FOSA).
They have chartered the semi-submersible Borgny Dolphin at a rate of $ 130,000 per day for two years plus options to drill at least 5 wells.
"Rigs are in such short supply, there was no way we could have got four units down to the Falklands separately," says Andy Morrison, vice-president of international operations at Amerada.
FOSA has worked well so far, he says, and sees nothing to stop the four members using the agreement as the basis for any future development phase.
Amerada will spud the region's debut well in May in the south of tranche A. On completion the semi is scheduledto drill on Lasmo's tranche C or D before going on to spud wells on IPC's tranche F and Shell's tranche B.
It will return to tranche A between December this year and February 1999 to drill a second well for Amerada.
Excluding the drilling campaign, the cost of establishing support facilities on the islands, towing the rig from the North Sea and providing associated services comes to around $25 mm.
A number of large anchor handling tugs including the Maersk Puncher are currently towing the rig to the South Atlantic " it is due to arrive in late April " while the Veesea Pearl has been upgraded to operate as a standby vessel during the drilling campaign.
About 10,000 tonnes of supplies, mainly sourced out of Aberdeen, will be needed for the drilling campaign.
The key downhole suppliers are Western Atlas, Halliburton, Schlumberger, Weatherford, MI Drilling Fluids, DBS and Maersk.
Other contracts have been awarded to SDC for site surveys, SubSea Offshore (ROVs) and ABB Vetco Gray (wellheads). Siderca in Argentina is providing the casing steel.
A Bristow-owned S-61 helicopter will be on the next ship down to the island's capital Port Stanley. A refuelling base for the helicopter is being set up at Cape Dolphin on the north coast of East Falkland.
About 80 to 90 people will be permanently based on the islands with the offshore crew working a 28-day shift. New crews will probably fly in from South America to Mount Pleasant airport outside Port Stanley. Supply chain management and operations will be provided by an Anglo-Falkland venture of Consolidated Supply Management and Stanley Services.
Amerada is keen to stress that environmental issues have been high on the agenda for the FOSA participants, particularly given the importance of fishing to the Falklands.
Each company has commissioned environmental screening studies to ascertain the sensitivities of the tranches and surrounding areas.
Also, a forum has been established called the Falkland Islands Exploration and Production Environmental Forum. Chaired by independent expert Professor Alasdair McIntyre, also chairman of the Atlantic Frontier Environmental Forum covering north-east Atlantic waters, it brings together the Falkland Islands government, local interest groups and FOSA.
An environmental impact assessment (EIA) has been carried out on the 5 tranches and the Falklands executive council has advised the government to accept the EIA following public presentations, the oil company's responses and an external review. FOSA's aim is to minimise the impact of seismic and drilling operations and to put in place effective waste disposal and oil spill prevention capabilities.