Goh De No
BANDAR SERI BEGAWAN
Thursday, December 29, 2011
THE Sultanate's upstream industry will see a significant boost in years to come as current developments steadily progress, on top of plans by authorities to introduce new offshore areas.
With the inaugural Energy White Paper set to be unveiled soon, the Energy Department at the Prime Minister's Office (EDPMO) is looking at newer areas which have the potential to significantly boost Brunei's production.
A significant increase in production is one of the highlights of the white paper as Brunei tries to remain productive after the "age of easy oil" has passed.
The biggest fear when dealing with natural resources is to see volumes dwindle, and the EDPMO with its white paper is committing strongly to its reserve replacement ratio, where the standard must always be greater than one.
This means every barrel of oil taken from the ground can only be done when there is knowledge of another barrel down there.
New offshore blocks
The EDPMO said that it is looking at offering new deepwater offshore blocks to investors, a move seen as the key to doubling the Sultanate's oil and gas production by 2030.
The department, in an earlier statement said apart from oil blocks that have been awarded, "new and unlicensed areas especially are being explored".
These areas have the potential to boost Brunei's production from 400,000 to 800,000 barrel per day of oil, which is one of the key performance indicators (KPIs) of the Energy White Paper.
Pehin Datu Singamanteri Colonel (R) Dato Seri Setia (Dr) Hj Mohammad Yasmin Hj Umar, the Energy Minister at the Prime Minister's Office, in February said: "We still have some blocks, some concessions out there that are to be explored."
Other developments
Brunei Shell Petroleum (BSP), which saw the appointment of its new managing director Ken Marnoch in February this year, reported two significant breakthroughs: one at the Geronggong field and another at the Selangkir and Iron Duke (SKID).
BSP in March said the successful exploration of their Geronggong field could lead to an estimated several hunderd million barrels of oil.
"This is the deepest water in which BSP has discovered hydrocarbons in Bruneian acreage," BSP said, adding that it is a major discovery which will strengthen the country's supply.
Just over a week ago, BSP announced first oil production through the SKID project.
The project produced safely and ahead of schedule after it produced gas in October.
In PetroleumBRUNEI's Block L, operators AED Oil Ltd from Melbourne confirmed the presence of mobile hydrocarbons in its Lempuyang well.
The Block L joint venture early in the year reported disappointing test results, but in April, AED was still looking to raise additional capital to develop the well.
AED's Executive Chairman said the funds would be used for further tests in Block L, as he touted the block's "commercial potential" despite an earlier decision to abandon tests in Lempuyang-1 due to mechanical issues.
However, on December 12, Kulczyk Oil Ventures Inc, who initially held 40 per cent interest in the block, acquired all of AED's shares to increase its total interest in the block to 90 per cent.
Currently, a seismic programme is underway and two additional exploration wells will be drilled prior to the end of the Phase 2 exploration period of the Block L Production Sharing Agreement.
Kulczyk also holds a 36 per cent interest in Block M, with Australia's Tap Oil Limited with 39 per cent interest in the block. The Block M joint venture entered Phase 2 of the exploration programme under the Production Sharing Agreement, which will see a minimum of three onshore wells drilled.
Like AED, Tap Oil has also chose to withdraw from Brunei by selling of their stake in the block on September 17 to Polyard Petroleum International Exploration and Production Pte Ltd (PPIEP).
Tap Oil confirmed that the block's prospects had nothing to do with the sale, but that it was a matter of going in a "different direction".
Tap's former Country Manager Chris Swarbrick said with the appointment of a new CEO, they were shifting their focus towards North-Western Australia, Thailand and Ghana.
Challenges faced in upstream oil & gas
Since Brunei first found oil in 1928, the main concern for the Sultanate is the day that the black gold runs out.
Pehin Dato Hj Mohammad Yasmin previously said that due to activities conducted in deep water sites, which require the utilisation of the latest technology and thus greater expenditure it "proves that there is no more cheap and easy oil production in this country".
The minister then stressed the importance for public awareness and has been relentlessly promoting Energy Efficiency and Conservation (EEC) initiatives, as well as renewable energy projects, and ever since, has been pushing Brunei on both fronts.
"That is why we are creating awareness amongst the public," he said, so that Brunei can conserve as much energy as possible, to ensure it lasts beyond the current generation.
Dipetik dari - The Brunei Times
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