Essar ready to explore in Nigeria and Vietnam

Vol 14, PW 5 (26 Aug 10) Exploration & Production
     

Essar Oil is gearing up to begin exploration at its sole Nigerian and Vietnamese offshore blocks.

In Nigeria, Essar has a 100% stake in shallow offshore block OPL-226, where it was reinstated as operator in March despite winning the block in May 2007 and ejected a year later. PETROWATCH learns Essar is now setting up an office in the country’s commercial capital Lagos and plans to drill one well next year at the 1250-sq km block.

But first, Essar will shoot 500-sq km of 3D to narrow down drilling locations. OPL-226 sits in water depths of up to 180 metres and Essar aims to drill the planned exploration well to the Pliocene and Miocene era sediments at approximately 3000-metres below the seabed.

Essar believes hiring a jack-up will be easy as many are currently looking for work; it is also upbeat about the Nigerian block’s commercial potential. “Shell used to hold this acreage and drilled about five wells before relinquishing and handing over to a local operator who drilled another well,” explains a source.

“Since then there’s been no development or production at this block. But Eni, Shell, Chevron and other majors are producing nearby.

” In Vietnam, Essar is set to reprocess and reinterpret 4000-lkm of 2D at offshore Block 114, also previously held by Shell in the 1990s before going back to the Vietnamese government and being re-auctioned. The PSC for this 5925-sq km Song Hong basin block became effective only in March this year even though Essar won the block in March 2008.

Block 114 extends from the Vietnamese coastline and sits in up to 400-metre water depths. In the seven-year exploration phase, Essar has committed to shoot 1000-sq km 3D and drill one well.