HOUSTON – Apache Corp. announced significant discoveries on two exploration wells in the Beryl area of the UK North Sea.
The company stated it also drilled two significant development wells in the Beryl area, from which no reserves have been previously booked. Additionally, Apache announced a large discovery at its Seagull prospect, which lies approximately 50 mi (80 km) south of the company’s Forties field, the largest oil field in the UK North Sea.
The K and Corona wells are the first exploratory prospects drilled by Apache in the Beryl area. Each discovery proves a separate geologic concept that helps to de-risk additional drilling locations. Apache estimates the K and Corona discoveries, combined with the success at Seagull, represent likely net recoverable reserves of 50 MM to more than 70 MMboe. Future appraisal drilling will enable the company to further define the upside potential beyond 70 MMboe. The company’s proved reserves in the North Sea at year-end 2014 were approximately 140 MMboe.
Thomas E. Voytovich, Apache’s executive vice president - International and Offshore and E&P Technology, said: “Apache’s exploration program in the high-potential Beryl area is off to an exceptional start. The success of our first two exploration wells at Beryl, combined with the Seagull discovery, could increase our total North Sea proved reserve base by more than 50%. Importantly, results obtained from the wells announced today emphasize the quality of our seismic surveys and the accuracy of our geologic model in the Beryl area.
“Our large discovery at Seagull will likely have a longer investment time-horizon as it may require dedicated production facilities, but it is expected to have a very meaningful impact on Apache’s medium- and long-term production in the region.”
Details of the five discovery wells include:
K discovery - After the initial discovery with the 9/19B-18 well in June 2015, Apache successfully drilled two side tracks into adjacent fault blocks in the Beryl area. In total, this discovery includes more than 1,500 ft (457 m) of high-quality, oil-bearing sands within the Beryl, Linnhe, Nansen and Cormorant formations, across three distinct fault blocks. Apache is the operator of this discovery with a 55% working interest (WI), and partner Shell has the remaining 45%.
Corona discovery - The 9/18a-39A Corona exploration well, also located in the Beryl area, tested Apache’s first Tertiary-aged injectite prospect. The well was drilled to a true total vertical depth subsea of 6,411 ft (1,954 m) and logged 225 ft (69 m) TVD net pay in excellent reservoir-quality sandstone. Apache has a 100% working interest (WI) in this discovery.
Beryl ACN development well - Drilled from the Beryl Alpha platform, the ACN development well encountered 131 ft (40 m) TVD net pay in the Nansen and 40 ft (12 m) TVD net pay in the Eiriksson formations. The well was successfully completed in the Nansen and came online Oct. 8, 2015 at a test rate of 11,194 b/d and 30.4 MMcf/d. Apache holds a 60.55% WI in the well, and partner Shell has the remaining 39.45%.
Nevis Central L4S development well - The L4S pilot well, also located in the Beryl area, was drilled to a TVDSS of 9,298 ft (2,834 m) and logged 114 ft (35 m) TVD net pay in the Triassic Lewis formation. The pilot was followed by a high-angle producer that yielded a 30-day initial production (IP) rate of 45 MMcf/d and 2,166 b/d. The well has been producing since early July 2015. Apache has a 60.55% WI in the well, and partner Shell has the remaining 39.45%.
Seagull discovery - An appraisal well was drilled about 50 mi (80 km) south of the Forties complex in block 22/29c in the Seagull discovery and confirmed 672 ft (205 m) of net oil pay over a 1,092-ft (333-m) column in Triassic-age sands. The well was flow tested with a facility-constrained rate of 8,700 b/d and 16 MMcf/d with a very low pressure drawdown. Further appraisal work will continue following the recent acquisition of a multi-azimuth 3D survey. Apache will assume operatorship of this license from Talisman Sinopec Energy UK Ltd. later this year subject to necessary approvals. Apache has a 35% WI. Partners in the well include Talisman Sinopec Energy UK Ltd. with 50% WI and JAPEX UK E&P Ltd. with 15% WI.
“The North Sea team has generated tremendous value in 2015 for Apache shareholders, despite a significant year-over-year reduction in capital spending. The discoveries we announced today, coupled with the North Sea’s substantial inventory of development locations, provide low-risk investment optionality at very attractive rates of return,” John J. Christmann, IV, Apache’s CEO and president, said. “Our objective is to achieve a balanced investment profile of short-, medium- and long-cycle projects across our global portfolio. The North Sea discoveries we announced today are attractive across the full spectrum of those investment time horizons. These discoveries further reinforce our confidence that our North Sea business has the ability to sustain production volumes, extend the Forties and Beryl productive lives out beyond 2030 and consistently provide significant free cash flow back to the corporation.”