Dragon outlines next-phase plans for Turkmen fields

Offshore staff

ASHGABAT, Turkmenistan – Oil output from the Cheleken Contract Area in the Turkmen sector of the Caspian Sea should reach a peak of 100,000 b/d in 2015, according to operator Dragon Oil.

Currently the facilities are delivering 67,000 b/d of crude oil and more than 140 MMcf/d of gas. Ten new wells have been put into production so far this year, with three more to come. These should lift 2011 exit production to around 70,000 b/d.

During 2012-15, the company expects to maintain average production growth of 10-15% per annum, and to sustain plateau output of 100,000 b/d for at least five years.

The company is assessing further options to enhance oil recovery from the reservoir, including water injection on the Dzheitune (Lam) field. Results from preliminary injectivity tests have been good, Dragon says, and a pilot water injection project should be implemented next year.

The Turkmenistan government has approved tendering for equipment for this pilot program, the first step before a potential implementation on a wider scale. If successful, it could allow more oil to be recovered and output to exceed 100,000 b/d.

Dragon aims to achieve these targets via a range of investments that include deployment of up to three drilling jackups, additional platform-based rigs, construction of new platforms, and further new infrastructure projects.

The newly built Caspian Driller, a Super M2 jackup, should be delivered to Turkmenistan during the first half of next year, and Dragon currently is tendering for another land rig and a further Super M2 jackup, for mobilization in 2012 and 2014 respectively.

The company has awarded a contract for construction of the Dzhygalybeg (Zhdanov) B platform, with contracts due to follow next year for the Dzheitune (Lam) D and E platforms. These facilities should allow completion of 15-20 new wells per year.

Capital spend on infrastructure (excluding gas monetization) during 2012-15 should reach roughly $1 billion.

10/25/2011



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