We are: Ready Technically
The geological and geophysical studies have been completed and from a G&G standpoint we are ready to drill.
Since 2012, our focus has shifted to completing the work required to finalise well locations and more importantly to completing the studies necessary to plan and to safely execute the drilling of our initial obligation well.
The acquisition of 3D confirmed and better defined the prospective structures mapped on the 2D. Significantly the data also provided additional encouragement regarding source potential and fetch area.
What do you mean by 'we are ready technically' to drill?
Our licences were awarded in 2007, since that time we have worked diligently to collect all available historic geological and geophysical data and where possible re-examine using modern technologies and interpretative techniques. At today’s prices the data would have cost millions of dollars to acquire. This information, especially that from the previously drilled wells, afforded us sufficient excitement and encouragement to go ahead and invest in the acquisition of new information, particularly seismic data to better understand the detail of the petroleum systems and ultimate scale potential of our licences.
Subsequently, all of the new data we have collected and interpreted confirms The Bahamas has ‘World Class’ petroleum potential, with multiple, very large traps identified. Well data confirms the reservoir potential; seismic and well information provide encouragement for sealing intervals; and, the regional geology provides evidence of the likelihood of rich source rocks in the Upper Jurassic. The geological and geophysical (G&G) studies have been completed and from a G&G standpoint we are ready to drill. With the acquisition of the recent 3D seismic survey we also have all the data necessary to be able to design a well with the best chance of success and optimised from a safety perspective.
What work remains to be done?
Much work needs to be done before we spud our first well. The Government has now put new regulations in place to oversee oil and gas activity which reflect global industry best practice. We have completed and submitted an Environmental Impact Assessment (EIA) to the Authorities.
We have completed extensive oil spill modelling to understand where we need to be ready to intercede in the unlikely event of an incident. We have completed our worst case discharge calculation and a drilling hazard study of our acquired multibeam data.
We have completed our oil spill response plan and our Environmental Management Plan (EMP) is substantially complete, we are a member of The Oil Spill Response Group, an association that can provide additional ‘clean-up’ equipment should it be necessary and plan to ensure close co-operation with the Cuban authorities in the near future to evaluate how emergency response capabilities can best be integrated. Our well planning and design has been completed, having re-engineered the well design provided by ADTI in their FEED study to incorporate additional learnings from recent technical studies, reduce the overall cost of delivery and ensure compliance with the recently revised Petroleum Regulations.
Has the 3D materially changed the conclusions reached by the Ryder Scott 'Competent Persons Report'?
It is our opinion that the 3D has enhanced the original 2D generated conclusions. However, there are some changes to our interpretation and perception of risk. Ryder Scott estimated the risked potential to be greater than 1 billion barrels from the Aptian through Top Cretaceous section, with an average risk of about 1 in 4 from three gross reservoir intervals on each of four structures. Three of the structures were each assessed to have unrisked potential in excess of 1 billion barrels of oil. Ryder Scott did not assess the potential in the younger Tertiary section nor the pre-Aptian and Jurassic section. The 3D confirms the overall integrity and size of the mapped structures. On the 3D the mapped structures at Albian and Aptian levels beneath the thrust trend closest to Cuba (designated ‘Thrust A, Fold A’ in the CPR – see page 15) appear to be velocity artefacts of the Cretaceous carbonate platform. If confirmed by completion of the 3D interpretation this would likely impact potential estimated by Ryder Scott at this location, however, we believe this is more than compensated for by modifications to the overall risking as well as the pre-Aptian section in the next thrusted structure (designated ‘Fold B’) as well as the broad Jurassic closure beneath the thrust. More importantly the 3D now shows the section below ‘Trend A’ to be dipping uniformly to the south west and providing an uninterrupted oil migration pathway from the Cuban foredeep source location.
Your licences have a variety of play types, what is your current thinking on the first well?
There are a variety of play types on our acreage; reef margin plays similar to Golden Lane in Mexico, fore reef debris and breccia plays similar to the Canterell complex, very large foreland basin structures comparable in geology and size to many fields in the Middle East and possible deeper rift basin structures.
We believe the best location for our initial well will be to test ‘Fold B’ into the upper Jurassic. The CPR indicates this feature has the potential for over 2 billion barrels of oil in the Cretaceous section alone. We will plan our initial well to a depth of approximately 22,500 feet which will take it through the thrusted anticline across the thrust fault into a broad structure in the Upper Jurassic. We believe this well will test the largest potential volumes, multiple reservoir sections and will provide definitive information on the anticipated Jurassic source. Based on previous work we anticipate the well will take about 120 days and will likely be drilled with a semisubmersible rig in water depth of about 1500 feet.
It's pretty far down the road but have you thought about development options?
There is still significant geologic risk – the chance that we will drill a dry hole, but if we are successful the final development plan would depend on the type of hydrocarbon found (oil or gas), oil gravity and wax content, and ultimately the absolute volume of hydrocarbons found. At present a phased development using subsea well heads and an FPSO would seem to be the most efficient way of ensuring early production, minimum environmental impact and providing both direct and indirect employment.
Simon Potter, Chief Executive Officer
Simon Potter qualified as a geologist with an M.Sc in Management Science, has over 30 years oil and gas industry and mining sector experience and has participated in operations around the world, including many environmentally sensitive areas.