[Gabon] Dussafu

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escveritas
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[Gabon] Dussafu

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The Dussafu Marin Permit and the associated Ruche Exclusive Exploitation Area (EEA) production license are located approximately 50 kilometers off the coast of Gabon.

The Ruche EEA covers an area of approximately 850 square kilometers. The water depth within the Ruche EEA ranges from 70 meters in the northeast corner to 650 meters in the southwest corner. Six oil discoveries have been made on the license to date: Tortue, Hibiscus, Ruche, Ruche North East, Moubenga and Walt Whitman.

The area comprising the Tortue, Hibiscus, Ruche and Ruche NE fields is centrally located within the Ruche EEA, with a water depth of approximately 116 meters.

Oil from Dussafu is a good quality crude that generally trades on an equivalent basis to Brent. The crude is typical of the region and is sweet with an API gravity of 28 to 30 degrees API.

Phase 1 started production on 16 September 2018 and currently has a gross production rate of around 10,700 bopd from two wells at the Tortue Field. Approximately 5.5 mmbbl has been produced as of December 2019. Field uptime since start-up has been 99%, which is industry leading. Phase 2 development at Tortue was sanctioned in late 2018 and is in the execution phase. It will consist of the drilling of four additional subsea production wells at Tortue, three of which will target the Gamba reservoir and one will target the Dentale 6 reservoir.

The wells will be tied back to the BW Adolo FPSO. Drilling and completion of these new wells began in 4Q 2019 and will continue through 2Q 2020. The first two wells are expected to start producing late first quarter of 2020. All four wells are forecast to be online by mid-2020, which is expected to result in an increase in overall production from the Tortue Field to above 20,000 bopd gross.

In August 2019, BW Energy discovered the Hibiscus Field. In 2019, the Ruche development was sanctioned. Ruche Phase 1 will consist of 6 development wells targeting the Hibiscus and Ruche Fields. These wells will be drilled from the Ruche Platform and tied back to the FPSO Adolo by a 20 km pipeline. First oil is planned for end-2021. Ruche Phase 2 will consist of up to an additional 7 wells targeting the Hibiscus, Ruche and Ruche NE Fields.

BW Energy sees significant potential for further growth at Dussafu. There are the two undeveloped discoveries of Walt Whitman and Moubenga as well as a large inventory of undrilled prospects and leads that are being evaluated.
escveritas
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Re: [Gabon] Dussafu

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BW Energy: Acquisition of jack-ups to be converted for Dussafu developments and Q3 production update

Acquisition of jack-ups to be converted for Dussafu developments and Q3 production update

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BW Energy has concluded on an alternative development plan for the Hibiscus/Ruche satellite field in the Dussafu license offshore Gabon, utilising a converted jack-up rig to reduce investments and time to first oil.

Subsequently, the Company has acquired two jack-up drilling rigs, the 2003-built sister-units “Atla” and “Balder”, from Borr Drilling Ltd. BW Energy will pay a total of USD 14.5 million for the two units.

“A jack-up conversion will enable us to reduce capital investments by about USD 100 million compared to our previous development plan,” said Carl Krogh Arnet, the CEO of BW Energy. “We are benefitting from the availability of high-quality jack-up units at very attractive prices due to the current drilling market slump. By re-using facilities we will also achieve a substantial reduction in field development related CO2 emissions compared to a newbuild platform.”

The seismic reprocessing carried out by BW Energy has indicated the potential for a substantial increase to the Greater Hibiscus oil-in-place volumes, making further developments in the Hibiscus/Ruche area highly likely.

“This development concept offers tangible financial, schedule and environmental benefits. We have consequently decided to secure a second jack-up at a very attractive price to prepare for the future development of the Dussafu license,” said Carl Krogh Arnet. “Acquiring a sister unit will enable us to re-use the engineering and project plans for a second development with obvious synergies.”

Calculations show that redeployment and conversion projects offer 70%-80% reductions to greenhouse-gas emissions compared to new built assets due to reduced steel consumption and shorter yard stays. Further tangible benefits are reduced installation cost as a jack-up can “self-install” after mobilisation to the field and no need for piling into the seabed for stability.

As announced on 16 September, the new development plan is expected to lower the estimated cash-break even oil price for the Hibiscus/Ruche (phase 1 and 2) development to approximately USD 25 per barrel Brent. With the planned increased production from Hibiscus/Ruche, the Dussafu license production cost, including the Tortue field, is expected to drop to approximately USD 11 per barrel. A final decision to restart the Hibiscus/Ruche development is subject to a lifting of COVID-19 restrictions to allow for efficient project execution.

The initial FID approved for the Hibiscus/Ruche development was approved in the fourth quarter of 2019 with an estimated gross development cost of about USD 660 million for both phases and proven resources (2P) of gross 112 million barrels of recoverable oil.

THIRD QUARTER 2020 PRODUCTION UPDATE
Gross production from Tortue averaged 15,449 bbls/day in the third quarter of 2020, amounting to a total gross production of 1,421,329 bbls of oil. BW Energy completed one lifting in the quarter, realising an average price of approximately USD 46 per barrel. Production cost (excluding royalties) was USD 19.6 per barrel. This includes approximately USD 2 million of additional costs related to the COVID-19 pandemic in the quarter.

BW Energy’s share of gross production was 1,044,676 bbls of oil. Net sold volume, which is the basis for revenue recognition in the financial statement, was 548,441 bbls, reflecting an under-lift position of 299,110 bbls at the end of the third quarter.

The company generated a positive cash flow with a cash balance of USD 145 million at 30 September 2020, compared to USD 128 million at 30 June 2020.
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