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Nova Scotia predicts 8-10 new offshore wells
Kay Cashman Petroleum News Publisher & Managing Editor
Despite several years of demoralizing drilling results and a dry hole tab estimated to be $600 million, the Nova Scotia Department of Energy said late last month that it expects eight to 10 new wells to be drilled offshore Nova Scotia by fall 2004. The agency said it based its estimate on drilling commitments and plans announced by E&P companies.
By the end of 2006 the agency expects to see nine shallow-water wells and 18 deepwater exploration wells drilled based on exploration commitments of $1.56 billion on 57 license blocks.
“During the past 24 months, nine wildcat wells were drilled on these blocks with a total investment of more than $450 million,” the agency said.
The latest Canada-Nova Scotia Offshore Petroleum Board estimates put Nova Scotia’s shallow and deep water plays at 33 trillion cubic feet of recoverable reserves.
Nova Scotia’s optimism was mirrored by John Hogg, EnCana’s vice president for Atlantic Canada, earlier this summer when he predicted 10 deepwater wells in the next two years, describing the potential for large new finds as “very good, although today they remain elusive.” (See related story in the July 13 edition of Petroleum News titled “Canada’s East Coast teeters.)
Exploration in 2003 In its report on exploration in 2003, the agency said EnCana has spud its Margaree F-70 exploration well on EL 2378, adjacent to the Deep Panuke field, “in hopes of finding more commercial reserves to improve the economics of the 1 tcf project.”
Prior to being put on hold earlier this year, the C$1 billion Deep Panuke gas project was scheduled to come on stream in 2006 at 400 million cubic feet per day as Nova Scotia’s second producing gas field after Sable.
But EnCana has said that without reserves to supplement its existing 935 billion cubic feet, Deep Panuke could be deep-sixed. A decision from the Calgary-based independent is expected later this year, but Canadian Superior Energy President Greg Noval told the Canadian Press news agency late last month that EnCana had made an “excellent” find at Deep Panuke.
Other exploration activities the agency said were planned for 2003 include the following:
• EnCana is also expected to drill the Weymouth block (EL 2380) later this year. Weymouth is in deepwater 60 kilometers west of the Annapolis discovery.
• Canadian Superior and El Paso have said they will drill a shallow water exploration well later this year on Canadian Superior’s Mariner block, EL 2409.
• ExxonMobil has issued an expression of interest for a rig to drill in shallow-waters and plans for a potential shallow water well.
* Imperial Oil Resources Ventures has contracted the Eirik Raude and is drilling Nova Scotia’s fourth modern-era deepwater well at Balvenie B-79 on EL 2378 approximately 300 kilometers southeast of Halifax.
The agency said seismic activity is also gaining strength with a number of operators acquiring 3-D and 2-D seismic.
“A total of eight to 10 seismic programs are expected over the next 12 months. Both EnCana and Marathon are conducting extensive seismic programs. BP is planning a well in 2005.” the agency said.
Finally, Kerr-McGee is working with EnCana to conduct a joint environmental assessment on the Laurentian Subbasin ELs 2414 and 2404 and Kerr-McGee is expected to drill its first well in 2004, the agency said. Development activity led by ExxonMobil The agency said development activity has been led by ExxonMobil at the Sable offshore energy project’s Alma field where both Alma 1 and Glenelg H-59 have been drilled and Alma 2 is currently being drilled.
Alma is the first field to be developed in phase one of the Sable project. Production is set to begin as early as this coming fall, the agency said.
Production from the first three Sable fields in phase one is averaging around 500 million cubic feet per day, the agency reported.
—Gary Park contributed to this story
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