Saudi Aramco has begun a major shale-gas exploration campaign targeting the Kingdom's estimated 600 trillion cubic feet of shale gas and other unconventional deposits.

According to the county's oil minister, Aramco will drill up to seven test wells this year.

The world's biggest exporter is struggling to meet domestic demand for natural gas, the most common feedstock in its power plants, and has been forced to expand its production of its conventional gas resources.

Since launching an unconventional gas program in 2011 in the northern region of Saudi Arabia, the Kingdom is committing the gas resources to develop a 1,000-megawatt power plant that will fuel a mining and manufacturing center for phosphate (Wa'ad Al-Shammal).

A government spokesperson said that appraisal drilling will begin for three prospective shale-gas sites in northwestern Saudi Arabia, in the south Ghawar region, and at a condensate-rich shale-gas site in the Rub' al-Khali, in the southernmost part of the country.

The Rub' al-Khali Qusaiba shale project is planned to power electricity generation in southwestern Saudi Arabia at Jizan, which will provide energy for a 400,000-barrelper-day refinery by early 2017.

—Larry Prado

1 Canada

Statoil has reported that a Bay du Nord prospect exploration well has found 300- to 600 million bbl. of recoverable oil at the offshore Newfoundland prospect in Flemish Pass. A sidetrack well has been completed and further delineation is planned. The #1-Mizzen discovery has an estimated 100- to 200 million bbl. of recoverable oil, and the Harpoon discovery is still under evaluation. The Bay du Nord well hit 34-degree-gravity light oil in Jurassic reservoirs with high porosity and high permeability. Stavanger-based Statoil is the operator of the Flemish Pass exploration licenses NL10-02-2 and NL10-03-1 and the Mizzen, Harpoon, and Bay du Nord wells with a 65% interest. Husky Energy holds the remaining 35% interest.

2 Brazil

Petrobras announced a discovery in the ultra-deepwater Block BM-SEAL-11 in Brazil's offshore Sergipe-Alagoas Basin. According to the Rio de Janeiro-based company, the field could hold more than 1 billion bbl. of oil. Block BM-SEAL-11 contains large amounts of high-quality light crude and gas, which may exceed 3 billion bbl. of oil in place. Appraisal drilling is planned to determine recoverable reserves volumes. A new discovery well, #1BRSA1104SES, was drilled to 6,056 meters and confirmed further extension of the light-oil reservoirs that were found with appraisal well #1-Farfan. Petrobras is the operator of the BM-SEAL-11 Block and wells with 60% interest. IBV do Brasil holds the remaining 40%.

3 Cyprus

Houston-based Noble Energy Inc. announced results from an offshore Cyprus discovery in Block 12. The #2-Aphrodite appraisal well hit 120 ft. of net gas pay in Miocene sand. The #2-A Cyprus is about four miles northeast of the #2-Aphrodite appraisal and was drilled to 18,865 ft. in 5,575 ft. of water. Noble reported that production testing over a 39-ft. section of the upper Miocene reservoir had a maximum gas flow rate of 56 million cu. ft. per day and was limited by surface equipment. Noble's performance modeling indicates development wells in the reservoir could deliver up to 250 million cu. ft. of gas per day. Evaluation of drilling data, wireline logs, and reservoir performance information has provided an updated estimate of gross resources of the field ranging from 3.6- to 6 trillion cu. ft., with a mean 5 trillion cu. ft. of gas. The Cyprus A structure is the third-largest field discovered within the Deepwater Levant Basin. The #1-Aphrodite discovery well penetrated 95 meters of gas pay and has approximately 3-to 9 trillion cu. ft. of gas reserves and some 3.7 billion bbl. of oil reserves. Noble plans to move the rig to offshore Israel's Tamar SW to test a prospect offsetting the main Tamar Field. Noble is the operator of Cyprus' Block 12 and the Aphrodite discovery and appraisal wells with 70% interest. Partners Delek Drilling and Avner Oil Exploration each have 15%.

4 Kenya

In Kenya's Lokichar Basin, London-based Tullow Oil Ltd. announced an oil discovery at wildcat exploration well #1-Ekales in Block 13T. Drilling, wireline logs, and samples of reservoir fluid indicate 60- to 100 meters of net oil pay in Auwerwer and Upper Lokone sandstone reservoirs. Additional flow testing is planned to confirm zone productivity. The well was drilled to 2,500 meters and targeted a three-way fault closure against the main basin bounding fault. The fault is 15 kilometers northwest of the Ngamia discovery and 7 kilometers south of the Twiga discovery. Tullow will move the rig to drill prospect #1-Amosing (south of #1-Ngamia) and plans to drill 12 wells during the next 12 months. Tullow is the operator of Kenya's Block 13T and #1-Ekales with 50% interest. Partner Africa Oil holds the other 50%.

5 Thailand

An onshore Thailand exploration well, #1ST Sinphuhorm East, in Block L/15/43, flowed 50 million cu. ft. per day at a surface-constrained rate. Production is from a Permian-aged Pha Nok Khao (PNK) reservoir in Sinphuhorm Field. According to block operator APICO, the reservoir section of the well was drilled vertically to an intermediate depth of 2,255 meters. The venture hit the top of PNK at 2,075 meters. Shut-in pressures indicate that the drilled reservoir is in communication with the main Sinphuhorm gas field. Bangkok-based APICO is drilling ahead to determine gas-water contact depth and complete reservoir deliverability. Block 15/53 operator APICO holds 100% interest in the block and the producer.

6 Vietnam

In offshore Vietnam's Gulf of Tonkin, an Eni exploration well encountered gas shows in the upper three objectives before hitting an overpressured gas zone at 2,568 meters. The well, #1-Cua Lo, is in Block 105-110/04 in 78 meters of water. Eni plans to sidetrack and case the well above the overpressured zone to collect reservoir samples and to perform wireline logging before drilling ahead to the deeper two objectives (Lower Pliocene to Upper Miocene) at 2,826 meters. After reaching total depth, the Rome-based company will determine whether to perform production testing. Eni is the operator of Block 105 and #1-Cua Lo with 50% interest in partnership with KrisEnergy, holding 25%, and Neon Energy, with the remaining 25%.

7 Vietnam

Operator PetroVietnam announced drillstem test results from Block 16-1 in offshore Vietnam's Te Giac Trang Field. The exploration well, #10XST1-TGT, is in the H5 fault block in Block 16-1. The combined peak-oil production from two of the three zones tested is more than 16,500 bbl. per day. The third drillstem test hit approximately 250 meters of gross pay in Miocene and Oligocene reservoirs. The first test was conducted on a net 93-meter section in Oligocene C and flowed up to 9,488 bbl. per day of 41.1-degree-gravity API oil and 1.16 million cu. ft. per day of gas. The second test, over the Miocene Lower 5.2L sequence, had a net 47.3-meter interval and a maximum flow of 7,100 bbl. of oil and 1.76 million cu. ft. of gas per day. The field is a joint venture of Petrovietnam (41% interest), SOCO International (30.5%) and PTT Exploration and Production, 20.5%.

8 Australia

ConocoPhillips' exploration well #1ST2-Proteus in offshore Western Australia's Browse Basin produced 7.3 million cu. ft. per day of condensate-bearing gas during a production test. Gauged on a 16/64-in. choke, the flowing wellhead pressure was 4,457 psi from a 4,920-5,250 meters open-hole section in Jurassic Plover and Montara. ConocoPhillips is the operator of the WA-31-P, WA-315-P, and WA-398-P Browse Basin permits containing the Greater Poseidon gas discoveries. Partner Karoon holds a 40% interest in permit WA-315-P and WA-398-P, and a 90% interest in permit WA-314-P, with Houston-based ConocoPhillips holding the remaining interests.

9 Australia

In Queensland, Australia, Armour Energy Ltd. reported results from an exploratory well in the ATP1087 permit area. The #4-Egilabria was drilled to 1,839 meters and hit gas in Mesozoic Carpentaria at 344 to 417 meters. According to Brisbane-based Armour, significant gas shows were encountered in Lawn shale, which was penetrated between 1,060 to 1,200 meters with a pressure build-up (70 psi) noted in desorption canisters filled with cuttings from this interval. The well was deepened to penetrate Riversleigh shale at 1,450 to 1,700 meters and had significant gas shows in three separate zones. According to the company, the presence of gas off-structure at #4-Egliabria indicates a continuous gas-charged shale sequence in Lawn shale between #4-Egliabria and #2-Egilabria.

10 Australia

According to Oil and Gas International, Senex Energy has a new oil discovery at the #1-Dunlop exploration well in the Cooper-Eromanga Basin permit PEL113 in South Australia. Wire-line logs have confirmed a net three-meter pay interval in McKinlay Member. Subsequent drillstem test resulted in 1,200 bbl. of free-flowing oil per day. Senex also reported that an interpreted 9-meter Murta pay interval was found. The well will be cased and suspended as a future oil producer and the rig will now move to drill the #2-Pirraminta exploration well in PEL514.

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