Elsewhere in the region . . .
  from: Offshore Engineer
  by: Jennifer Pallanich
  Thursday, April 03, 2008

In other Latin American developments, Mexico continued its march into deepwater, courts resolved several maritime border disputes and a number of countries held deepwater licensing rounds. Jennifer Pallanich reports.

Argentina

Most of the spotlight on Argentina in 2007 revolved around its continued dispute with the British government over the latter’s licensing of Falkland Islands’ hydrocarbon resources. Off Argentina, however, a consortium is focused on deepwater exploration.

A few years back, Argentina president Néstor Kirchner created an energy company called Energía Argentina Sociedad Anónima, or Enarsa, majority owned by the state. To kick up exploration levels, Enarsa announced that it would jointly explore the country’s offshore acreage with regional state oil companies.

Energia Argentina, YPF, Petrobras and PetroUruguay formed a consortium for the offshore Enarsa-1 and CCM-2 areas, which contain some zones in water depths exceeding 1500m. The area in question, according to Enarsa, is about 200km east of the coast and includes both the continental shelf and deepwaters.

Barbados

Barbados’ energy and environment ministry is offering 24 blocks in the Northeast Caribbean Deformed Belt under the 2007 Offshore E&P;Licensing Round launched last June. All of the blocks are in deepwater, according to IHS, which is helping with the round.

Bids are due 4 April and winners are to be announced 5 May. The round features a new fiscal system and petroleum law and regulations. The blocks on offer carry a 3% royalty rate on oil and gas production.

Wavefield Inseis shot about 6000km of long offset multiclient 2D data, which was available for the round. The M/V Akademik Nemchinov acquired the survey towing an 11,500m streamer with a powerful airgun source for improved imaging of both shallow and deeper targets for Wavefield Inseis. The survey was designed to establish the major hydrocarbon prospective trends in the Barbados offshore sector, and the survey grid was designed to delineate the structural relations between the Tobago Basin, the Barbados Ridge and Barbados Trough as well as the northwest part of the Barbados Ridge, according to Wavefield Inseis.

The energy ministry sees the remaining potential as greatest in the south and western parts of offshore Barbados in the Barbados and Tobago Troughs and along the Barbados Ridge, although neither of the latter two has been tested with the drillbit. Conoco- Phillips, the only previous offshore operator, relinquished its block in 2004.

Colombia

Colombian Agencia Nacional de Hidrocarburos (ANH) awarded three deepwater blocks to consortia during the 2007 Caribbean Round. A fourth deepwater block on offer was not awarded. ANH’s Colombia Round 2008 is all onshore.

Petrobras operates the deepwater Tayrona concession, which extends from the coastline to 3000m water depth and covers 22,500km² in the Colombian sector of the Caribbean. Partners include Exxon and Ecopetrol. A recent Tayrona well was said in early 2008 to be dry.

The ANH says results of a Wavefield Inseis survey over a region with waters exceeding 1000m depth indicate interesting formations that may justify additional studies to the determine hydrocarbon potential. The work focused on the region east of the Islands of San Andrés and Providencia in areas that are not under dispute.

Cuba

Venezuelan state oil company PDVSA announced last July that it was entering a joint effort with its Cuban counterpart Cupet to explore Cuba’s deepwater for hydrocarbons. They plan to jointly explore six blocks covering some 10,000km2 where PDVSA says it expects to confirm the existence of light oil deposits capable of producing at high volumes. Under phase one, 4400km of 2D seismic will be acquired. Cuba has yet to find any commercial hydrocarbon in its deepwater.

Falkland Islands

In 2007, Falkland Oil & Gas (FOGL) ended a year and a half-long search for a farm-in into its deepwater Falkland Island licences. It found a partner in BHP Billiton, which signed on to rights to operate the E&P licences in the East Falkland Basin off the southern and eastern coast of the islands. The licences cover 18 million acres in water depths of 650ft-6570ft.

FOGL calls BHP’s entry into this area a confirmation of the petroleum potential of the South and East Falkland Basins. Under the agreement, at least two exploration wells will be drilled in the next three years. FOGL has estimated that no rigs will be available for drilling prospects until at least mid-2008.

The long-running territorial dispute between Argentina and Britain over the islands, which gave rise to the Falklands conflict of 1982, continues to simmer, albeit in less warlike fashion. Argentina let it be known recently that it will discourage all ‘Las Malvenas’ exploration by BHP.

The offshore petroleum industry in the Falkland Islands is in its infancy: only six wells, all testing one play, have been drilled. Nonetheless, FOGL remains enthusiastic about the island chain’s hydrocarbon prospects. Last year, it reported encouraging results from its controlled source electromagnetic (CSEM) survey with positive CSEM anomalies that indicate the possible presence of trapped hydrocarbons in the Caird, Garrodia, Loligo, Lutra, Nimrod, Toroa and Undine prospects. FOGL also said it now has improved definition of top prospects based on the 2D infill seismic survey results. Seabed coring and site surveys are anticipated this year.

Petroleum Geo-Services carried out a 1500km² 3D seismic campaign for exploration company Borders & Southern over its South Falkland Basin acreage in 2007. The acquisition programme is slated for completion in 1Q 2008.

Guyana

The United Nations International Tribunal for the Law of the Sea (ITLOS) cleared up the Guyana and Suriname maritime border dispute in September 2007. The dispute was sparked in June 2000 when the Surinamese military evicted a CGX oilrig operating under a Guyana licence from its location, claiming the vessel was in Suriname waters.

Guyana’s president Bharrat Jagdeo called the UN declaration ‘very favorable,’ saying it will allow exploration to resume in areas that were in Guyana’s maritime waters. Following the decision, Guyana’s Geology & Mines Commission began regulatory preparations for exploration companies to resume work in the area awarded to Guyana. Seismic vessels aren’t expected until later this year.

Honduras

An International Court of Justice ruling in The Hague settled a dispute over the shared border between Honduras and Nicaragua. Under the ruling, Nicaragua received more sea territory but Honduras got some islands formely claimed by Nicaragua.

The Honduran government is planning to launch an offshore bid round in 3Q 2008, but it is unclear whether the blocks will be in shallow or deep waters.

Jamaica

In a bid to cash in on offshore resources, Jamaica last year launched an informal bidding round for its shallow and deepwater concessions. Through the course of the year, three blocks with deepwater areas and one other offshore block went to Hong Kong-based Proteam, which intends to acquire seismic in late 2008.

According to IHS, which helped with the bid round, eight deepwater blocks were on offer, and other blocks containing deepwater areas were also available. Of 20 offshore blocks, according to the Petroleum Corporation of Jamaica (PCJ), a dozen are now under licence, and seismic has already been carried out in water depths exceeding 1500ft off Jamaica’s coast. The PCJ says there is a plan to conduct a multiclient nonexclusive 2D seismic survey on the remaining eight offshore blocks using a long streamer acquiring 14-16 seconds of data to examine the deep seated cretaceous rocks.

Jamaica hasn’t had commercial hydrocarbon discoveries reported. Neither of the two wells drilled offshore to date have encountered hydrocarbons.

Mexico

Pemex is not a deepwater powerhouse yet, but it could be if its estimated deepwater 3P hydrocarbons potential of 29.5 billion boe bears out. Last year, Pemex estimated the country’s total 3P hydrocarbons potential at 45.4 billion boe, 55% of which is thought to be in the deep waters of the Mexican Gulf of Mexico.

Pemex aims to produce hydrocarbons from its deepwater projects starting from 2014, according to a recent strategy briefing. The briefing discussed efforts planned through 2009, and Pemex indicated that increasing exploration through contracts to third parties is a viable option to opening up the country’s deepwater reserves. Further, the briefing stated, the fiscal regimen should permit execution of riskier and more costly deepwater activities.

Between 2004 and 2006, Pemex drilled four exploratory deepwater wells, of which it called three successful. Last year, the company acquired deepwater seismic over its Holok-Temoa project in the deepwater Gulf. It also drilled the Lalail-1 well in 2600ft of water and reported initial production of 18.1mmcf/d of nonassociated gas. The Chuktah-201 well, drilled in 2006, did not show hydrocarbons but the Lakach-1, Nab-1 and Noxal-1 wells did.

Following the Noxal-1 find, Pemex declared: ‘The exploratory opportunities in the neighboring geological structures to Noxal-1 suggest the presence of hydrocarbons and have allowed the identification of eight megastructures with significant possibilities of containing hydrocarbons.’ Pemex suggested additional exploratory drilling would validate potential and prompt establishment of development plans.

Lakach, in 850m, is said to be in the bidding process, Lalail in 800m is considered a discovery, and Noxal in 950m is said to be in the concept stage.

Pemex was slated to begin drilling the deepwater Chelem well beginning this month.

At the end of 2006, Pemex had identified 234 deepwater exploratory opportunities. The company is working to increase the number of authorized exploratory locations to accelerate incorporation of proved reserves, to strengthen deepwater capabilities and know-how along the E&P;chain and to increase its execution capability through third parities where it is not feasible for Pemex to explore and/or develop.

At the end of last year, Pemex awarded seabed logging specialists EMGS a $10 million contract to determine the hydrocarbon content of deepwater drilling locations in the Gulf of Mexico. Pre-acquisition services were expected to be completed by the end of 2007 and the electromagnetic imaging survey was slated to start in 1Q 2008.

The Mexican government is also looking to the United Nations for a decision on ownership in the area in the deepwater Gulf of Mexico known as the Doughnut Hole, so called because this gap lies over 200 miles from both the US and Mexico coasts.

The countries bilaterally agreed in 2001 on a division of the area and further agreed a decade-long moratorium on drilling to allow time to study deposits to ensure both nations have fair access to reserves.

Peru

Perupetro Bid Round 2007 led to four of five deepwater blocks being awarded. Block Z-48 was not awarded. Block Z-45 went to Petro-Tech Peruana, Z-46 to SK Corporation Sucursal Peruana, Z-47 to PetroVietnam E&P, and Z-49 to Petro-Tech Peruana.

The country plans to launch a new bid round this month, but it had not been disclosed by press time if deepwater acreage would be included.

Peru last month instituted proceedings against Chile before the International Court of Justice (ICJ) over a maritime boundary dispute.

The area in question is one that Peru says lies within 200 nautical miles of Peru’s coast but that Chile considers to be part of the high seas.

Peru is asking the ICJ to settle the boundary question and to give Peru sovereign rights in the waters within 200 nautical miles from its coast but outside Chile’s exclusive economic zone or continental shelf.

Trinidad & Tobago

Trinidad & Tobago plans to launch a deepwater bid round for blocks in the north and east coast marine areas in 2008, according to IHS.

In 2006, Trinidad’s ultra-deepwater bid round with eight blocks on offer netted only one bid, which has been attributed to less attractive terms than in years past.

Venezuela

Venezuela’s deepwater seems to have gone quiet of late with recent PDVSA-related announcements concerning nationalization of its hydrocarbon resources, its shallow-water initiatives, its efforts with Petrocaribe, and the decision to explore in Cuba’s deepwaters with Cupet.

Rafael Ramirez, Venezuela’s energy and petroleum minister as well as PDVSA president, said PDVSA will invest $15.6 billion dollars in 2008 to develop the company’s 2005-2030 ‘oil sowing plan’. The six-point plan, to be implemented in the periods 2005-2012 and 2012-2030, sees development projects with the Magna Reserve, the Orinoco project, the Delta-Caribbean project including work at the Deltana platform, refining, infrastructure, and Latin America/ Caribbean integration through Petrocaribe and Petrosur. OE

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