GSPC exit gives Oilex free run at Cambay field

Vol 24, PW 12 (06 May 21) Exploration & Production

Oilex (45%) is preparing to revive production at the dormant 161-sq km Cambay block in Gujarat, which it shares with its soon-to-be ex-partner GSPC (55%).

On April 26 (2021), the London-listed Australian explorer announced Indian government approval of a 2021-22 work programme and budget allowing it to begin appraisal and drilling and re-start "low-rate production" at Cambay, suspended since 2019. Oilex managing director Joe Salomon said the work programme would be "directed at establishing gas production from the substantial resource base in the EP-IV reservoir."

In an earlier statement on April 6 (2021), Oilex said work would include two vertical wells to evaluate Eocene siltstone reservoir gas accumulations through 'hydraulic stimulation' or fracking using recommendations from a 2017-18 'best practice' study commissioned from Baker Hughes-GE. "It is anticipated that the results of the pilot programme will provide data to determine whether horizontal wells can provide an estimated three to five times increase on well productivity," said Oilex, "offering the highest commercial returns for the project and a final development plan which, given success, would involve batch drilling of many wells."

Oilex's last set of relatively modest production figures for Cambay in its December 2018 quarterly report said the field produced on average 107,000 cf/d (3029 cm/d) gas, 3.36 b/d condensate and 0.57 b/d oil. "Oilex has undertaken detailed studies which have outlined the most effective drilling, stimulation and flow testing programmes to develop the discovered gas accumulation and importantly, which identified no impediments to potentially building a significant production base from the known EP-IV gas resource," said Salomon.

Oilex wants all hydrocarbon production from Cambay to use "existing processing and storage facilities" and connect "to a local low-pressure gas pipeline." Longer term, Oilex said it aims to "aggregate sufficient production volumes from multiple wells to connect to the high-pressure (Gujarat gas grid) pipeline system which will offer greater offtake stability and improved gas prices."