Extended-reach drilling under review for Phase 2 of Sakhalin-1

Offshore staff

LONDON – The Sakhalin-1 consortium plans to add a second land rig to drill long-reach wells offshore as part of series of investments to access further reserves from the Chayvo, Odoptu, and Arkutun-Dagi fields off Sakhalin Island.

Russia’s government awarded the production-sharing contract (PSC) in 1995 and the current members are ExxonMobil, Rosneft, SODECO, and ONGC-Videsh.

According to ExxonMobil Russia President Glenn Walker, speaking at the Institute of Petroleum’s recent IP Week conference in London, “the project has been successful in many ways. It remains one of the largest single international investments in Russia, and has helped advanced technical skills and management in harsh environment [projects].”

Estimated recoverable reserves from the three fields are 370 MMbbl of oil and 485 bcm of gas. Chayvo started production through extended-reach wells drilled from shore in late 2005. This was followed by the start-up of Odoptu via two platforms in 2010, and last year start-up on Arkutun-Dagi through the Berkut platform, one of the largest ever built.

“So far we have produced 580 MMbbl of oil and 18 bcm of gas, delivered to customers in Russia,” Walker said.

Along the way, the consortium has established several records, including nine of the 10 longest horizontal wells ever drilled.

The latest was a 13,500-m (44,291-ft) well on Chayvo last summer, with a horizontal reach of 12,038 m (39,494 ft).

At Arkutun-Dagi, he added, oil production should build to a peak of 32.5 MMbbl/yr.

The next step for the consortium is to proceed with design and development of Odoptu Phase 2, Walker said. Plans call for added gas injection and water treatment capacity, and the addition of a second land rig of the same size and modular construction as the Yastreb to drill more extended-reach wells of more than 13,000 m (42,651 ft).

Work on the gas injection/compression project started late last year. The various additional production facilities could be in place from 2017-18, allowing the partners to access an additional 250 MMbbl of oil.

However, there is also a significant undeveloped gas resource, Walker said, particularly in Chayvo, and evaluation will continue. One of the current options is to build an LNG plant, selling the gas to customers in the Far East, he said, “although we don’t yet have the optimum solution.”

Over the course of the project, he concluded, $14 billion of contracts have been issued to Russian companies, and the development has employed more than 700 Russian nationals.

Olivier Lazare, Shell country chair for Russia, pointed out that the Sakhalin-2 consortium started up Russia’s first LNG project in 2009. The two-train plant on Sakhalin Island that receives gas produced offshore operated last year at its nameplate capacity of 10.8 million tons per annum, Lazare said, representing 4.5% of global LNG production.

Last year the plant also delivered its 1,000th cargo. The facility operates on Shell’s proprietary dual-fuel mix, designed for Arctic temperatures, and uses less gas than any other plant for the liquefaction process, Lazare claimed, with the waste heat generated employed in the treatment process.

Shell Global Solutions and the Russian Design Center are currently working on ways to expand output, he added, possibly using supplies from the offshore Kirinskoye gas field in the Sakhalin-3 PSC, operated by Gazprom, although the timing could depend on the lifting of sanctions against Russia.

“We could also use the existing Sakhalin-2 infrastructure to monetize gas from Sakhalin-1,” he added.


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