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TOTAL Flows 4,330BPD of Condensate in South African Discovery

By Toyin Akinosho

French explorer TOTAL, has finalised a drill stem test on the Luiperd-1X well, its second major discovery on Block 11B/12B offshore South Africa.

The well was opened to flow on November 1, 2020.

After several tests at different choke settings, the well reached a maximum constrained flowrate through a 58/64″ choke of 33Million standard cubic feet per day of natural gas (MMscf/d) and 4,320 barrels of condensate per day (BCPD), an aggregate of approximately 9,820 barrels of oil equivalent per day (BOEPD), according to a report by Africa Energy, a junior partner on the asset.

”The choke configuration could not be increased due to surface equipment limitations”, Africa Energy explains. “The absolute open flow (AOF) potential of the well is expected to be significantly higher than the restricted test rates”.

TOTAL itself had reported the Luiperd-1X discovery last October, stating that the probe intersected 85 metres gross sands of which 73 metres is net good quality pay in the main target interval and thicker than prognosed.

The well reached total depth of approximately 3,400 meters on October 12, 2020, at which point the drill stem testing programme was initiated.

Africa Energy commented: “We are very pleased with the positive test results that show high condensate yield and excellent reservoir connectivity. These results confirm the joint venture’s decision to proceed with development studies and to engage with authorities about commercialization.”

Block 11B/12B is located in the Outeniqua Basin 175 kilometres off the southern coast of South Africa. The block covers an area of approximately 19,000 square kilometers with water depths ranging from 200 to 1,800 metres. The Paddavissie Fairway in the southwest corner of the block now includes both the Brulpadda and Luiperd discoveries, confirming the prolific petroleum system. The original five submarine fan prospects in the fairway all have direct hydrocarbon indicators as recorded on both 2D and 3D seismic data and intersected in the wells, significantly de-risking future exploration.

Africa Energy holds 49% of the shares in Main Street 1549 Proprietary Limited, which has a 10% participating interest in Block 11B/12B. Total E&P South Africa B.V. is operator and has a 45% participating interest in Block 11B/12B.

Africa Energy says it believes Luiperd and Brulpadda can potentially support a significant commercial development.”

 


Otakikpo Phase 2 Drilling: Just A Little Delay

Green Energy and Lekoil are working through financing to fund the second phase development of the Otakikpo marginal field in eastern Nigeria, currently producing around 6,000Barrels of Oil Per Day.

There has been a little delay, as the drilling was earlier expected to have commenced in October 2020.

The funds are to come from a consortium of financiers, including Standard Chartered Shell Trading and an EXIM bank.  Drilling may now start by early December.

The original plan was to increase production from 6,000 barrels per day (BOPD) to 20,000BOPD, but the prevailing conditions may keep the immediate ramp up to around 12,000BOPD.

Schlumberger is the main subsurface service vendor.

Green Energy had signed a Memorandum of Understanding (MoU) with a consortium of international financiers for a package of more than $350Million, for the project funding.

The Field Development Plan FDP of the project involves the drilling of seven additional wells (there are two producing wells already) and expansion of the crude processing infrastructure. The plan also includes the construction of a 1.3Million barrels onshore terminal and a 17 kilometre export pipeline to connect the terminal to an offshore loading system.

 


Renewed Upstream Activity May Trigger Big Investments in Namibia, Angola and South Africa

 

By NJ Ayuk, Executive Chairman, African Energy Chamber

Last spring, the Maersk Voyager, an ultra-deepwater drillship under contract by French supermajor TOTAL, drilled a wildcat well in the deepest water ever – 3,628 metres (11,903 feet) in Block 48, a massive area with potentially huge oil reserves in the Congo basin offshore Angola.

The record-setting achievement wasn’t a success just for Maersk and TOTAL. It also represented a victory for Angola and state oil company Sonangol in their search for new oil, part of a campaign to reverse a recent trend of production declines. The high-impact concept well was long anticipated, and it didn’t take long for other global players, including Qatar Petroleum (QP), to buy in. As part of its bid to expand its exploration portfolio, QP acquired a 30% stake in Block 48 in August, its first venture into Angola’s promising deepwater acreage.

If Angola were the only southwestern African nation making oil and gas news, that would still be a pretty good story. But the fact is, Africa’s southwestern coast is home to perhaps the most globally anticipated wildcats of 2020 and 2021 – exploration that continues despite the added challenges of COVID-19, which has constrained operating and capital budgets. As the African Energy Chamber noted in our 2021 outlook, if successful, prospects in Angola, Namibia, and South Africa, could “open new basins for development and trigger big investments towards the latter half of the 2020s.”

That’s headline-making, indeed.

Combined with Block 48, the Venus-1 prospect in Namibia, and South Africa’s Brulpadda and Luiperd, the region holds world-class resource potential. The key is translating that potential into real benefits for all Africans.

Production is Building Momentum in Angola
For nearly 70 years, oil has been a mainstay of the Angolan economy, contributing about 50% of the nation’s gross domestic product and around 89% of exports. The country holds the continent’s third-largest proven oil reserves 9after Libya and Nigeria in that order) and is behind only Nigeria in terms of production.

In recent years, though, the drop in oil prices scared off foreign investment, putting pressure on Angola’s well-established oil and gas industry as well as its oil-based economy. Despite its vast resources, production hurtled downhill, and the country hasn’t witnessed a major new discovery since 2011. Without fresh finds, consultants Rystad Energy, S.A. said, volumes could drop below 1Million barrels per day by 2025, far below capacity and less than half the 2008’s daily output.

That forecast was more than enough to spur Angolan President João Lourenço into action.

Following his election in 2017, he promised Angola an “economic miracle” and immediately began incentivizing participation in the nation’s oil and gas industry as part of his turnaround plan.

Lourenço’s lures, including better contract terms that would make foreign investment more profitable, paid off. With reforms such as tax relief and a standalone oil industry regulator in place, TOTAL – which has been operating in Angola for six decades – moved quickly in 2018 to take over Block 48 and was awarded Block 29 in the Namibe basin earlier this year; Italy’s ENI was awarded neighboring Block 28 about the same time. Angola also awarded several offshore blocks to Norway’s Equinor and BP. (There are approximately 50 blocks in the Namibe basin, but whether they will all be put into play remains to be seen.)  ENI and its partners also began production at Agogo-1, pumping a modest 10,000 barrels per day. While that may sound small, it contributes to a much larger sum: Taken together, Rystad said, production from new Angolan projects – that is, those begun just in the last five years – should yield 549,000 barrels per day by 2025.

Fiscal Regime Sets Stage for Success in Namibia
If early seismic data is to be believed, compared to Angola there is equal, if not even more, promise in new discoveries offshore Namibia. Scientists compare Namibia’s geology favorably to the pre-salt fields offshore Brazil, which hold 16Billion barrels of crude reserves. Yet Namibia’s basins are considered underexplored, meaning there’s ample opportunity for foreign and domestic investment. The possibility of high-impact discoveries has attracted the likes of TOTAL, ExxonMobil, QP, and Kosmos Energy, which has had significant wildcat success in Africa over the past dozen years.

Currently, all eyes are on TOTAL’s possibly play-opening Venus 1- prospect, which may turn out to be the largest discovery in Africa in a decade. An ultra-deepwater well in the Orange Basin, which straddles the border with South Africa, Venus-1 is thought to have at least 2Billion barrels of oil in place. If Venus-1 is successful, it’s likely to attract even more attention to the area. Fortunately, the Namibian government’s oil-friendly policies make it easy for foreign companies to do business there. The fiscal regime is positive, and the state-owned oil company, the National Petroleum Corporation of Namibia (NAMCOR), is a cooperative partner. It also helps that Namibia is politically stable and has some of the best-developed infrastructure on the continent, including a modern electricity distribution grid.

We’re Seeing Growing Excitement in South Africa
Like its neighbours to the west, South Africa has been the site of considerable excitement over frontier discoveries, including Total’s Brulpadda, which opened up the Outeniqua basin in 2019. Brulpadda is considered a world-class oil and gas play that holds as much as 1 billion barrels of oil equivalent of gas and condensate light oil.

Brulpadda is considered an antidote to the cascade of ailments South Africa – like many countries with petroleum resources – has experienced in recent years: a drop in oil and gas exploration following a decline in commodity prices. It is likely that PetroSA’s gas-to-liquids (GTL) plant will provide a ready domestic market for Brulpadda, as will the nearby petrochemical and industrial facilities. It is also possible the discovery will help South Africa accelerate the use of gas for electricity.

TOTAL continues to explore other parts of the Outeniqua basin and just last month discovered gas condensate on the Luiperd prospect, where it is a joint venture partner with QP, CNR International, and an African consortium called Main Street. In an announcement, TOTAL said that the Luiperd well was drilled to a total depth of about 3,400 meters and encountered 73 metres of net gas condensate pay, making it even larger than the main reservoir at Brulpadda. TOTAL and its partners have decided to commercialize the Luiperd gas rather than drill another exploration well in the program.

Africans Must Realize the Benefits
There’s no question that these discoveries have made southwestern Africa an exploration hot spot.

Neither is there any doubt that the governments of Angola, Namibia, and South Africa have facilitated and even accelerated the discovery and development processes by making it easy to do business there. (In the case of South Africa, its fiscal terms for oil and gas companies are described as “very generous.”)

What remains uncertain is to what degree each country will continue working to ensure its natural resources, whether newfound or long-established, are used to lift people out of poverty. True, African involvement in joint ventures leads us to assume that the best interests of every citizen are being considered.

But this is a time for the oil and gas companies that are involved in these mega-opportunities to redouble their efforts to support local communities and people. These companies are our guests in Africa, but the price of a welcome to our resource riches can’t be merely contractual, a handshake between governments and businessmen. The more they profit, the more Africans should benefit.

This idea is at the heart of the concept of Shared Value, which has been defined as “a framework for creating economic value while simultaneously addressing societal needs and challenges,” and as the “practice of profit in a way that creates value for society.” Shared Value doesn’t suggest that businesses should act as philanthropies or charities, giving handouts to those who exhibit need. It goes beyond the idea of corporate social responsibility, which is often based on volunteerism and one-off donations. Perhaps most important, Shared Value recognizes that companies can only stay in business if they are making money. As consultants FSG described it, the value companies and the community are sharing is “worth,” that is, economic value on a financial sheet and societal value in the form of progress on social issues.

Shared Value recognizes that companies have a responsibility to take on social challenges through the business itself. It is in their economic interest to do this. In Africa, one way they can do that is by supporting capacity-building. As the Shared Value Initiative noted, despite the substantial economic output of the oil and gas industry, it has “not always translated into societal improvements in host countries and communities… companies are losing billions of dollars a year to community strife,” much of it due to underemployment.

As more companies are attracted to southwestern Africa and these exciting new developments, we can only hope that they will recognize that where opportunity exists for them it should exist for everyone. And they have the power to make it so.

That would be really big news.

(www.EnergyChamber.org)

 


TOTAL in A Second Big Discovery in South Africa

With the second major discovery in less than two years, South Africa is shaping to become a major gas/condensate heartland for the French major TOTAL.

The company has announced that its drilling of the Luiperd prospect, which follows up the play opening 2019Brulpadda discovery, has yielded another “significant gas condensate discovery” on the Block 11B/12B in the Outeniqua Basin, 175 kilometers off the country’s southern coast.

The Luiperd well was drilled to a total depth of about 3,400 meters and encountered 73 meters of net gas condensate pay in well-developed good quality Lower Cretaceous reservoirs. Following a comprehensive coring and logging program the well will be tested to assess the dynamic reservoir characteristics and deliverability.

We are very pleased with this second discovery and its very encouraging results, which prove the world-class nature of this offshore gas play,” said Arnaud Breuillac, President Exploration & Production at TOTAL. ‘’With this discovery and the successful seismic acquisitions, Total and its partners have acquired important data on the Paddavissie fairway, which will help to progress development studies and engage with South African authorities regarding the possible conditions of the gas commercialization.”

The Block 11B/12B covers an area of 19,000 square kilometres, with water depths ranging from 200 to 1,800 metres. It is operated by TOTALwith a 45% working interest, alongside Qatar Petroleum (25%), CNR international (20%) and Main Street, a South African consortium (10%).

 


Renergen’s Gas Well Fails at a Prime Position

A gas well being drilled by South African independent, Renergen, has collapsed at the very position the company considers most efficient and cost effective.

The well had been on a horizontal course, but Renergen had moved the trajectory on inclined drilling through the sandstone sequence to intersect the underlying faults in the underlying volcanic rock.

But the base assembly was lost before breaking through the base of the Karoo sedimentary rock and the company decided it best to abandon the well. Renergen has thus, again, revised the drilling programme and has also secured a directional drilling rig.

The dual listed Renergen (JSE, ASX) is the only active South African independent in exploration and production of hydrocarbon. Its Virginia Gas Project covers 187,000 hectares of gas fields across Welkom, Virginia and Theunissen, in the country’s Free State.

The asset holds both natural gas and helium. Renergen currently sells compressed natural gas (CNG) from the hub, but following a plant expansion planned for completion in 2021, Renergen will instead produce liquified natural gas (LNG).

Earlier in the course of the drilling, the company reported “strong gas flows with high (up to 12%) helium”, and announced that technical issues had necessitated significant changes from the original horizontal well design. It also said that the sections penetrated by several side-tracks had provided valuable encouraging data for future development drilling. The company noted, then, that the key learnings from the drilling were as follows:

  • The gas is migrating up through two major fault structures, named 2089 and 2057, which have a combined known strike length of approximately 31 kilometres
  • The gas emanating from the faults contains helium of up to 12%, and not the anticipated lower concentration (~3%). It was previously postulated that high helium (11%) in an earlier well at this site was a result of helium dissociation in the overlying sandstone reservoir
  • The sandstone is stratified with siltstone, and some coal, such that the zones of high porosity and permeability cannot be accessed efficiently with horizontal drilling.

It was the inclined trajectory chosen after these “key learnings” that has now been compromised by the failure of the rig.

“It is unfortunate that the drilling rod broke”, commented Renergen ‘s CEO Stefano Morani, “but unfortunately accidents happen beyond anyone’s control. The silver lining is that it resulted in us gaining access to a fit-for-purpose directional drilling rig, which means we will be able to drill with far greater confidence and speed.”

“Where we were drilling one before, now we have multiple targets being drilled concurrently, and in some highly prospective areas where indications of gas are strong, and no exploration drilling has been undertaken to date,” he explained.

 


PGS to Release Seismic Data for Namibe Basin in November 2020

PGS’ seismic acquisition vessel, Ramform Sovereign, has completed a large acquisition project offshore Angola using multisensor GeoStreamer technology. Operational and geological objectives were achieved successfully and safely, despite the COVID-19 restrictions.

The 2020 PGS Namibe Basin survey connects the three dimensional (3D) seismic coverage of southern Angola with PGS seismic data library coverage in Namibia, completing a large MultiClient footprint of high-quality broadband seismic data that spans the Namibe Basin.

Predicted reservoir presence and distribution maps indicate that this area contains a variety of leads and prospects”, PGS claimsin a release. “Full depth-imaging incorporating FWI velocity model building will improve knowledge of the subsurface petroleum system and reduce the risk for frontier exploration”.

The fast-track data for Angola Namibe Basin will be available in late fourth quarter, likely around November. 2020.

 

 


Sonatrach’s 50% Budget Slash, Cuts Out Sixty Planned Wells in Algeria

Algerian state hydrocarbon company Sonatrach is spending half of its originally planned budget for 2020.

Africa’s largest NOC was ordered to reduce its budget for 2020 from $14 Billion to $7 Billion(or from €12.4Billion to €6.2Billion).

The group, which contributes nearly 60% of the state budget and more than 95% of the country’s foreign exchange earnings, has significantly reduced its drilling and field optimization activities and suspended plans for newfield developments, no matter how close to existing facility. Africa Oil+Gas Report sources say that over 60 planned new wells will be affected.

There were 50 active rigs in Algeria in 2018, but they dropped to 42 in 2019. They would have dropped to 32, with COVID-19 challenges, but now they are likely to slip to 29, Africa Oil+Gas Report research suggests.

Hydrocarbon revenues into Algeria crashed by nearly 30% in the first quarter 2020, compared to last year.

Unlike most other hydrocarbon-led economies in Africa (Nigeria Angola, Libya, etc), most of the work programme in Algeria is performed by Sonatrach, as a result of historic production agreements that always insisted that Sonatrach operate the acreages.

So, unlike its peer countries, the state cannot spread the burden of financing oil and gas field operations in this time of pandemic, in a way that international companies have a good share of the risk.

Algeria, last year approved laws to encourage increased equity stakes and participation in acreages and projects by E&P companies, but the lingering antigovernment protests have discouraged implementation.

This article was originally published in the June 2020 edition of the Africa Oil+Gas Report


TOTAL Spuds the Second Well in the Cape of Storms

French major TOTAL has spud the Luiperd-1X well, the second exploration well on Block 11B/12B offshore South Africa following the Brulpadda discovery in February 2019.

The Luiperd-1X well will test the eastern area of the Paddavissie Fairway on Block 11B/12B to follow-up on the Brulpadda discovery of gas condensate and light oil. In the success case, TOTAL and the joint venture plan to flow test the Luiperd-1X borehole by performing a drill stem test. They look forward to drilling results in the fourth quarter of 2020.

Block 11B/12B is located in the Outeniqua Basin, covers an area of approximately 19,000 square kilometers with water depths ranging from 200 to 1,800 meters. The Paddavissie Fairway is in the southwest area of the block and includes the Brulpadda discovery, which confirmed the petroleum system. The Luiperd Prospect is the second to be drilled in a series of five large submarine fan prospects with direct hydrocarbon indicators defined utilizing both 2D and 3D seismic data.

The Luiperd-1X exploration well is being drilled in 1,795 meters of water by the Odfjell Deepsea Stavanger semi-submersible rig to a total depth of 3,550 meters subsea. The well will test the oil and gas potential in a mid-Cretaceous aged deep marine sequence where fan sandstone systems are developed within combined stratigraphic/structural closure. Drilling and evaluation of the well is expected to be completed in the fourth quarter of 2020.

TOTAL operates Block 11B/12B with 45% participating interest in, while Qatar Petroleum International Upstream LLC and CNR International have 25% and 20% participating interests, respectively, in the acreage. Africa Energy holds 49% of the shares in Main Street 1549 (Proprietary) Limited, which has a 10% participating interest in the Block.

 


Namibian Minister Delegitimises Kudu Field as A Discovery

By Akpelu Paul Kelechi

Tom Alweendo, the Namibian Minister of Mines and Energy, does not consider the Kudu gas field offshore the country as an asset.

When asked about his country’s contribution to conversations around global crude oil and gas demand and supply, he offered that “Namibia is a relatively new comer to this”. Then he said, surprisingly: “We don’t have a discovery, we have never had a discovery before and over the last couple of years, there have been some Majors doing prospecting in our sectors”.

The statement came in the course of a recent Webinar on Namibian Energy plans. The conversation was organized by African Energy Chamber.

The question that stood un-asked, after the minister claimed Namibia had never had a hydrocarbon discovery was: So, what should the Kudu Gas Field be called if it’s not called a discovery?

The Kudu field, discovered in 1974 by Chevron, is a deep-water field in 600 metres of water. The gas is stored in reservoirs at a depth of 4,400 metres (17,000 feet) and deeper, and they are interbedded with volcanic rock.

A huge challenge is that an estimated 1,3Trillion cubic feet of gas accumulation is not big enough for an LNG project, which is why the development concept has been around gas to power.  There’s considerable geologic risk around Kudu, but that’ not to say it’s not sitting there.

There has been a line of investors (including Shell, Tullow), going back the last 30 years who have taken a look at the Kudu field. Till date, the field is undeveloped. But its very presence suggests that Namibia is a hydrocarbon player. Mr Alweendo, instead, prefers to delegitimize the asset. He told the webinar: “I think the prospect of us becoming a player in the upstream is really growing by the day to the extent that now, we have a couple of the major oil companies doing exploration. Therefore, when that time comes when we actually do find something, hopefully we will not just continue to be a consumer but also a producer. But even as a consumer, as small as we are, of consumers have a role to play as well”.

This story was originally published in the June 2020 edition of the monthly, Africa Oil+Gas Report

 


TOTAL Will Now Drill Follow Ups in South Africa, From September 2020

TOTAL will return to drill in the rough waters offshore South Africa’s Cape Agulhas in September.

The French major will be commencing a multi-well drilling programme, beginning with the spud of the Luiperd Prospect, in the first follow -up to the Brulpadda oil and gas discovery it encountered in February 2019.

Luiperd-1, reputed to be the largest prospect in the Paddavissie Fairway (on which the Brulpadda itself is hosted), will be the first to be drilled by the semisubmersible rig Deepsea Stavanger, operated by Odfjell Drilling.  Two other wells are expected to follow in short order.

That the rig is currently mobilizing from Norway to South Africa, indicates the end of the idle period in the agreement between TOTAL South Africa and Odfjell Drilling. The programme was to have commenced in first quarter 2020, but restrictions effected by COVID-19 complications compelled the two parties to agree  that “Deepsea Stavanger will remain idle in Norway for a period prior to the mobilisation of the rig” and that “Odfjell Drilling will be compensated by TOTAL during this idle time”. The agreement also indicated that “once the idle period is complete, the rig will mobilise to South Africa to commence its charter as planned”.

Africa Energy, a minority partner in the licence holding and operations, declares its excitement “to begin the next phase of exploration drilling on Block 11B/12B offshore South Africa. in order to spud well by September”. The Canadian minnow explains that the prospect, Luiperd ’has been de-risked by the nearby Brulpadda discovery and subsequent 3D seismic work.”

Block 11B/12B is located in the Outeniqua Basin 175 kilometres off the southern coast of South Africa. The block covers an area of approximately 19,000 square kilometers with water depths ranging from 200 to 1,800 meters. The Paddavissie Fairway in the southwest corner of the block includes several large submarine fan prospects.

TOTAL is operator with a 45% participating interest in Block 11B/12B, while Qatar Petroleum and Canada Natural Resources have 25% and 20% participating interests, respectively.

 

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