Afren farms into Okwok

Afren has entered a joint venture agreement (JVA) to develop the Okwok oil field offshore southeast Nigeria.

Offshore staff

LONDON -- Afren has entered a joint venture agreement (JVA) to develop the Okwok oil field offshore southeast Nigeria.

Okwok was discovered by the Mobil/NNPC partnership in 1967 in license OML 67, 50 km (31 mi) offshore in 132 ft (40.2 m) of water. Three wells were drilled, encountering oil in the LD1 and D2 reservoirs. Over 100 ft (30.5 m) of oil pay was logged in the Okwok-2 well at the D2 level, with multiple 50-ft (15.2-m) oil-bearing sections at the LD1 level in this well and in Okwok-3.

Mobil contributed the discovery to Nigeria’s marginal field program in 2001, which led to a farm-in by Nigerian company Oriental Energy Resources in mid-2006. Soon afterwards, Addax Petroleum formed a JVA with Oriental, taking a 40% interest in the field and becoming technical advisor to the project.

The new partnership drilled three further appraisal wells in 2006, encountering over 100 ft (30 m) of oil pay in the D2 of Okwok-4, and similar pay in the LD1 series in Okwok-8. These wells produced respectively 32º and 27º API crude.

Afren estimates stock oil in place for Okwok of 225 MMbbl in the D2 and LD1c, LD1d and LD1e reservoirs, with 70 MMbbl recoverable. It also sees exploration upside at the deeper Qua Iboe level, where two prospects have been identified, each potentially with in-place oil of around 200 MMbbl.

Under the farm-in agreement, Afren will acquire a 28% legal interest in the field from Addax and an effective 70% economic interest (pre-cost recovery), reverting to 56% (post-cost recovery), subject to volumes lifted. Afren also will fund the cost of a further exploratory or appraisal well, after which it will jointly cover field development costs with Addax.

Near-term work includes detailed subsurface studies to determine the optimum location for this well; definition of the field development concept; and preparations for spudding a well in mid-2010 or earlier, depending on rig availability.

Afren sees synergies with its current development of Ebok field, where it is already in a partnership with Oriental. Here the targeted recovery is 53 MMbbl, with upside to 152 MMbbl. Afren sees scope for cost savings on the two projects through, for example, joint storage and export operations.

08/26/2009

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