Exploration and appraisal drilling activity in Thailand has remained busy in recent weeks, with a mixture of new discoveries being confirmed and some wells being brought onstream.

In addition, state-owned player PTT Exploration and Production Public Co. Ltd. (PTTEP) has put together a significant war chest for possible acquisitions of assets, with the operator having a keen focus on foreign plays outside of Asia.

Recent discoveries

Salamander Energy’s G4/50-5 exploration well on the Surin prospect in the Gulf of Thailand has made an oil discovery.

The well lies in Block G4/50 in the central part of the Western sub-basin. Oil was discovered in good quality Miocene fluvial sandstones in the primary N40 target zone over an interval of 1,525 m (5,004 ft) to 1,533 m (5,030 ft). Wireline logs and pressure data confirmed the presence of around 8 m (26 ft) of oil pay.

Oil samples recovered from the zone indicate 31°API oil, and mapping of the Surin fault block suggests between 15 m (49 ft) and 20 m (66 ft) of column height above the location of the well penetration.

Further evaluation is required to determine the potential resource volume encountered in the Surin discovery, Salamander said, adding the well has been plugged and abandoned as an oil discovery.

“The discovery of oil in the Surin fault block, a 25-km (16-mile) step-out from the Bualuang field, has proven the access to an oil charge in the Western Central sub-basin, which had been identified as a key risk pre-drill,” said James Menzies, chief executive of UK-based Salamander. “Resource estimates for Surin are being assessed, but this is clearly a positive step in derisking the neighboring prospects and in understanding the local petroleum system.”

Meanwhile, the WBEXT-2C appraisal well in the L44/43 concession has hit hydrocarbons and been placed into production, Australian partner Carnarvon Petroleum said.

The WBEXT-2C well was spudded on July 16 by the Elite-01 rig on the Wichian Buri Extension production license and reached a total depth of 1,235 m (4,052 ft) on July 27.

The well’s target was the Wichian Buri I and II fractured igneous reservoirs in a three-way dip closed structure bounded by a major north-south fault.

The well encountered the WBV1 igneous target at around 900 m (2,953 ft) downhole, as predicted, Carnarvon said. Oil shows were interpreted across this 20 m (66 ft) interval.

The WBV2 igneous target was reached at around 1,200 m (3,937 ft). But there were no oil shows although gas shows were present, Carnarvon said.

The company also said two shallower igneous intervals were encountered with good indications of permeability.

WBEXT-2C was cleaned up and tested, after which it was placed into production at around 330 b/d of crude.

The L44/43 concession is operated by ECO Environmental Investments, a subsidiary of Hong Kong & China Gas, with a 60% stake. Carnarvon holds the remaining 40%.

Rayong duster

However, it was not all good news on the exploration front, with Salamander reporting that the G4/50-4 exploration well, targeting the Rayong prospect in the Kra Central sub-basin, in Block G4/40 in the Gulf of Thailand came up dry.

The well was drilled to a total vertical depth subsea of 1,889 m (6,198 ft). It encountered a 119 m (390 ft) section of excellent quality P20 Miocene sandstones, the primary target on depth prognosis, Salamander said. But following the completion of a logging and sampling program, these sandstones were found to be water-wet.

Manora development costs rising

Mubadala Petroleum is being faced with a price hike for the Manora oil field development project in the northern Gulf of Thailand.

Australian partner Tap Oil said Mubadala indicated that Manora’s development costs are expected to rise by around 13% from those forecast at final investment decision (FID) made in July 2012.

The total project cost is now expected to cost US $278 million, a $32 million increase from the $246 million FID forecast. The revised costs and schedule estimates were attributed to further engineering work, procurement delays, growth in project scope, required design changes, and increased construction costs related to the offshore platform.

First oil from the Manora development is now scheduled for mid 2014, compared to the original target of early 2014. The Manora project is still expected to achieve a peak production rate of 15,000 b/d of oil from 10 production wells and five injection wells.

PTTEP unveils spending plans

PTTEP plans to invest in what it called “star” assets in hot spot areas like North American and East Africa as it looks to increase production by the end of the decade.
The operator has an impressive budget of nearly US $25 billion over the next five years to chase its targets.

PTTEP is also looking to raise its output through its presence in projects, such as Canadian oil sands and the gas rich province of offshore Mozambique.

The company said that it has its sights set on sales volumes of up to 600,000 boe/d by 2020 and has a budget of $24.7 billion on capital and operating expenditure in its 2013-2017 investment plan.

As well as maintaining plateau production at domestic projects such as S1, Bongkot and Arthit, PTTEP is looking to reach its target by fast-tracking E&P activity in foreign plays.

This includes the Zawtika gas field development offshore Myanmar, the Montara oil field off Western Australia, the Cash-Maple floating LNG project off Australia, Canada Oil Sands KKD, and Area-1 in the Rovuma basin offshore Mozambique.

PTTEP plans to increase “proved reserves for more than 10 years of reserve-per-production ratio by accelerating exploration in parallel with partnering with prudent partners,” it said.

Part of this will include investing in “star” assets in Thailand, Myanmar, North America, and East Africa “while focusing investments on projects which are in production or are nearing production.”

President and chief executive Tevin Vongvanich said “We have considered that a goal to achieve sales volume up to 600,000 boe/d by the year 2020 is a realistic and possible goal.”

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