Is Busta a bust?

Exploration well on the Busta prospect on PL782S has been drilled in 127m of water in the Jotun-Balder area of the Norwegian North Sea. It appears to be a marginal discovery with preliminary resource estimates of 6-60mmboe (vs. pre-drill 50-200mmboe).

Two separate gas/condensate and oil-bearing intervals totaling ~25m were encountered -the primary target hitting the reservoir with the secondary target water bearing.

Busta is operated by ConocoPhillips (40%) with AkerBP, Dea and Equinor each with 20%.

The Leiv Eiriksson rig which drilled the well is now scheduled to relocate to the neighbouring block, PL917, to drill the Enniberg/ Hasselbaink prospect.

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Maria, you've gotta see her!

Wintershall has shut-in the Maria field since February, approximately a year after first production, following poor production performance. It is understood that reserves have been downgraded from 207mmbbl to c.60 mmbbl.

The field is now undergoing testing and monitoring to see how best to produce the remaining reserves the recover the lost reserves whilst managing the reservoir. It is understood that the NPD has to review plans and sign off on the field's restart for fear unintended reservoir damage. There is currently uncertainty on whether the field will start up again.

The cause is believed to be poor connectivity between zones. Water injection is provided to the zone below for pressure support. However analysis is now showing low connectivity between the geological layers in the reservoir, and thus the water injection is not working effectively.

Wintershall started production from the Maria oil field on Haltenbanken in the Norwegian Sea in December 2017, one year ahead of schedule and with 20% reduction in costs. Maria was Wintershall’s first own-operated field in Norway.

Wintershall chose an innovative subsea concept to develop the field. Two subsea templates were installed on the seabed above the Maria reservoir and connected via a pipeline network to the existing Kristin, Heidrun, and Åsgard B platforms.

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Premier success at Zama

Premier and operator Talos have announced the successful appraisal of Zama-2 offshore Mexico. This is the second well on the Zama field, following the initial discovery at Zama-1 in 2017, and reaffirms the massive 600mmbbl oil discovery.

The well penetrated 152m of net pay with a high net-to-gross of 73% (vs. Zama-1 of 63%). This suggests potential resource upside and could see resource estimates being upgraded as the appraisal campaign continues.

Zama-2 will now be sidetracked to penetrate the reservoir vertically to aid coring and testing. The upcoming Zama-3 well will appraise the southern portion of the accumulation. With good confidence on the underlying resources, the Zama partners should now be thinking ahead on development plans.

The Zama field is planned to be developed from a single drill centre with drilling from the platform. Three production platforms are envisaged, each with capacity of up to 100mbopd. Produced oil is planned to be transported via a pipeline to the Dos Bocas terminal located onshore, c.70km away from the field.

For Premier Oil, this development could overtake the Sea Lion development in the Falklands (another large resource optionality for the company), adding visibility to additional near-term production growth.

The Zama partners are: Talos (35% operator), Sierra Oil & Gas (40%), Premier Oil (25%).
Sierra Oil & Gas was recently acquired by DEA.

#Premier #Zama #Mexico #Block7 #Talos #Sierra #Wintershall #DEA

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DEA acquires Sierra Oil & Gas

DEA has expanded its international footprint into the Americas by acquiring Sierra Oil & Gas from Riverstone Energy.

The Sierra portfolio includes the prized Zama discovery (Sierra Oil & Gas 40%, Talos Energy 35%, Premier Oil 25%) and an extensive exploration acreage position offshore Mexico.

The value of the deal is reported  at ~USD500 million which provides a positive read-through for Zama of over USD300 million net to Premier.

The acquisition further bolsters the Wintershall DEA portfolio ahead of its planned IPO in 2019-2020 and adds prospective acreage in what is otherwise a production (but stable) weighted profile.

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Nova development could face delays with Gjøa tie-back challenges

Nova (formerly Skarfjell) is planning to submit the field development plan to the Norwegian authorities in H1 2018. The selected development concept is four production wells and three injection wells from two subsea templates tied back to the Gjøa platform. Neptune which operates Gjøa has raised concerns about the potential tie-back which it has now raised with the Ministry of Petroleum.

Nova is an oil and gas field operated by Wintershall and this would make it the company’s second development in Norway after Maria. The field is estimated to contain c.100mmboe of resources with c.70% oil. In December, the Ministry ruled that field that tie-back to existing infrastructure only need to cover the direct incremental costs of the host platform and not any of the existing operational costs. This was intended to boost activity in Norway. However, Neptune claims that the tie-back could increase overall costs for Neptune as well as impact its ability to tie-back its own discoveries including Cara and 35/9-3 in the vicinity.

A response from the Ministry is now pending and the ruling could determine how the Nova development plan filing will proceed.

The Nova partners are Wintershall/DEA (35% operator/10%), Cairn (20%), Spirit Energy (20%) and Edison (15%).

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