Tullow closing in on further Jubilee area developments

Offshore staff

LONDON – Production from the Jubilee field offshore Ghana is currently around 80,000 b/d of oil from seven wells, according to operator Tullow Oil.

The plateau rate of 120,000 b/d should be reached by August following completion of the final two Phase 1 production wells.

The slower than anticipated ramp-up was caused by the need for extended maintenance on the drilling rig Eirik Raude’s BOP, a delay in commissioning the third water injection pump, and extra work to commission the gas compression system.

Otherwise, Jubilee is performing as expected and pressure support is being provided by water injection at a current rate of 145,000 b/d, expected to climb to 230,000 b/d later this year.

Now that the gas compression is fully commissioned, gas is being injected at around 80 MMcf/d.

Tullow says Jubilee Phase 1A, the next planned stage of development, will require up to eight further producer and injector wells targeting around 100 MMbbl of reserves, and will extend the field plateau through 2015.

The partners expect to submit the draft development plan to Ghana’s government in August and are assuming project sanction during 4Q 2011. This would allow drilling to start early next year using the recently contracted rig Sedco Energy, followed by first production in mid-2012.

In the Deepwater Tano license which takes in the western part of Jubilee, development planning also continues for the Enyenra-Tweneboa discoveries, in parallel with a program of appraisal drilling and flow testing to determine reservoir connectivity.

Front-end engineering and design (FEED) contracts for the FPSO and subsea development will be awarded this quarter. Assuming further appraisal success, the partners hope to submit a Plan of Development and receive sanction for the project in the first half of 2012, leading to first production within two and a half years.

Initial FEED work will focus on an FPSO scenario involving production capacity of 75,000-125,000 b/d of oil and gas handling capacity to allow gas injection and cycling, maximization of liquid recovery, and future gas export.

A flow test will start later this month on the Tweneboa-4 well to determine reservoir productivity and the level of connectivity with Tweneboa-2. This will be followed by drilling of the Enyenra-3A appraisal well to test the updip extent of the Enyenra field.

The drillship Deepwater Millennium comes off contract in October, but should have been replaced by the Sedco Energy on a two-year contract from September. Before starting work on the Jubilee Phase 1A program in March (assuming sanction), Sedco Energy will re-drill and flow test the Owo-1 well, and drill Enyenra-4A to test the field’s ultimate downdip extent.

In the adjacent West Cape Three Points block operated by Kosmos Energy and containing Jubilee’s eastern segment, five separate hydrocarbon pools were discovered by the Teak-1 well earlier this year in Campanian and Turonian age reservoirs.

Two appraisal wells are planned, the first of which - Teak-3 – should spud in 4Q 2011. This will assist delineation of the field’s extent and reservoir distribution. It will be followed by Teak-4.

The Teak-2 exploration well, drilled into an intermediate fault block between Teak-1 and the Jubilee field, intersected a gas pool in the Turonian which may represent the Jubilee gas cap. If confirmed, this would have a major bearing on future phases of development on Jubilee.

Studies to determine if this is the case are progressing, and Tullow expects gauges to be deployed in Teak-2 to monitor pressure changes induced by production operations at Jubilee.

Elsewhere in the block, the Makore exploration well is under way, targeting a discrete fan of Jubilee age, and will be followed by the Dahoma Updip well, testing a channel in the far eastern part of Mahogany East (SE Jubilee).

The partners have discussed a development plan for Mahogany East with the government, and expect to embark on further appraisal work next year, combined with appraisal of the Teak field. The purpose of the alignment is to ascertain whether a larger, combined development might be justified. If successful, the likely scenario would involve an FPSO serving as the hub for a cluster of fields.

Later this month, the drillship Discoverer Spirit should arrive in Liberia to drill the Montserrado exploration well for Anadarko, with Tullow as a partner. The rig then heads to Sierra Leone to drill the Jupiter exploration well and the Mercury-2 exploration/appraisal well. That campaign should be completed by late November.

In late May, Tullow exercised its pre-emptive right to acquire a further 10% in block SL-07B-10 (originally blocks SL-06 and SL-07) which contains the Mercury and Venus discoveries.

Offshore Namibia, Tullow has concluded terms for a new petroleum agreement and a 25-year production license for the Kudu offshore gas field with the Ministry of Mines & Energy. It now awaits signature.

Design concepts for the offshore development and associated onshore power station are under evaluation. A single integrated concept for detailed engineering design should be selected shortly. Negotiations continue on a gas supply agreement for the power station.

On the other side of Africa, Tullow signed a farm out agreement in May with Pancontinental Oil & Gas and Afrex to take a 10% interest in block L8 offshore Kenya, where numerous prospects have been identified by seismic survey.

Last month, Tullow signed a separate farm out agreement for a further 5% interest of the block with Origin Energy Kenya. Both agreements are pending Ministerial approval.

The first exploration well in block L8 should be drilled in mid-to-late 2012, after which Tullow will have the option of acquiring a further 5% interest from Afrex.

07/05/2011



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