Still too early to judge Hazira appraisal wells

Vol 14, PW 1 (01 Jul 10) Exploration & Production

Niko Resources is hoping for the best as it tries to reverse declining production at the ageing Hazira gasfield, which it shares with GSPC.

Gas production from Hazira has declined sharply from highs of 4.7m cm/d in 2005, to 1.5m cm/d in 2008, and just 1m cm/d today. Niko embarked on a three-well appraisal programme on February 25 hoping to reverse this downward trend.

The appraisal programme is scheduled to end by mid-July when drilling will be completed at the third appraisal well with a 1500-hp John Energy rig. But a senior Niko source says the results of this appraisal programme will be known only after production testing begins sometime between July and November this year.

Two of the appraisal wells, he adds, will be tested through a temporary ‘flow line’ to be laid between July and September. “The third (appraisal) well is close to our existing LBDP (Land Based Drilling Platform) and will be ‘tied in’ to that facility,” he says.

“There are no serious delays and we are meeting our original timeline.” Niko drilled the first appraisal well to TD in the Paleocene geological formation, while the other two wells were drilled to TD in the Oligocene formation.

“We cannot comment on the outcome as yet,” adds Niko. “This (programme) is still under evaluation.

No testing has been completed but there is one potential Eocene gas zone, limited gas potential in the Miocene formation and a potential oil ‘play’ in the Oligocene zone.” Niko was interested in investigating the ‘structure edge’ to look for trapped gas on a ‘lap’ or ‘pinch out’.

But it seems Niko has so far found no trapped gas. “The ‘sands’ appear to be connected to existing producers,” we hear, “and are either wet or depleted.

” Total costs for the appraisal programme, including seismic, drilling, completion and testing, are estimated at $22m.