Nam on edge as Repsol sinks oil rigs

 

Windhoek – Repsol SA, Spain's biggest oil producer started drilling the Welwitschia-1 exploration well on April 25, a development keenly watched by the Namibian government and the international investor community amid heightened expectations of a commercial discovery of crude.

The Welwitschia-1 prospect, believed to hold multi-billion barrel of crude oil, will be drilled to a depth of 3 000 metres to evaluate primary and secondary target reservoirs in the Maastrichtian and Aptian-Albian reservoir sequences.

It is the first exploration well to be drilled in Namibia this year, stoking hopes for a discovery of the golden liquid in commercial quantities.

A number of international majors as well as early star-up exploration companies have also lined up drilling programmes over the coming two to three years, which government says could prove critical in the country's oil and gas exploration industry.

A total of 18 wells drilled so far have hit dry wells, with the exception of Wingat-1 well, drilled by HRT Participacoes em Petroleo SA (HRT), which hit a sub-commercial discovery last year.

The HRT discovery has ignited a rush for Namibian oil blocks and a number of companies have lined up drilling during the coming two years.

Tullow Oil Plc, will drill an exploration well at block EL 0037 offshore Namibia, as part of a deal to retain its stake in the block, which it farmed in from Pancontinental Oil & Gas last year, Barry Rushworth, chief executive of the Australian company said at the oil and gas conference in Windhoek last week. Tullow will complete shooting 3D seismic in June this year and would likely have the full results before year end. “They will drill a well in the license area to retain their 65 percent, and this could be done next year,” Rushworth said.

The area to be drilled by Tullow in 2015 has revealed Apto-Albian source rocks 'analysed to be thick and mature to generate oil', Rushworth said.

Pancontinental has one of the largest offshore acreage and would continue to 'search for high quality impact ventures in Africa', Rushworth said.

Chariot Oil & Gas Ltd, a UK energy explorer in Africa says it is looking for a partner with 'expertise in deep water drilling' to drill its next exploration well in Namibia, chief executive Larry Bottomley told The Southern Times in an interview on the sidelines of the oil and gas conference.

“We are looking to partner and secure a rig as soon as possible to drill at one of the prospects,” Bottomley said on the sidelines of an oil and gas conference in Namibia.

Chariot, which holds licenses in eight blocks in Namibia, would continue to explore partnerships for more its licences, Bottomley added. It might cost between US$80 million to US$100 million to drill the next well, Bottomley said, without disclosing when the company intends to drill its next exploration well.

“We are looking to partner any oil company which can bring technical advantages and which has expertise with deep water. Right now I have no idea on when and with who we will do the drilling but we are working very hard and we are very optimistic about Namibia,” Bottomley said.

Despite previous failures, key to success in Namibia would be able to identify an oil reservoir. “Namibia has potential for discovery, giant scale discovery,” Bottomley said.

Serica Energy, another UK company also plans to start drilling once it secures farm in partnerships.

“We Discovered the First Namibian Oil” HRT, discoverer of the first oil in Namibia, will seek to farm out at all of its 10 blocks in Namibia to 'de-risk' after failing to find crude at two exploration wells drilled and a sub-commercial discovery at Wingat-1.

“We are looking for potential partners to carry out exploration with us. HRT has 10 blocks, we are the largest acreage holder in Namibia and we are looking for real partners,” Marcio Mello, a geologist who founded HRT in 2008, said in an interview. The Rio de Janeiro based HRT hit two dry wells, Mooseahead-1 and Muurombe-1 whilst a third well, Wingat-1 struck a sub-commercial discovery after drilling to depths of up to 5,700 metres.

HRT is the first explorer to make an ‘oil discovery in Namibia' at its Wingat-1 well, raising hopes for a discovery. But having sunk more than US$300 million and failing to find crude, HRT plans to rope in partners when it drills its next well, Meerkat-1, estimated next year.

"HRT has spent a lot of money in Namibia on the three wells and now is the time to de-risk. Yes, we discovered the first oil in but oil exploration is difficult, you rarely get it the first time,” Mello said.

April 2014
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