Salamander Energy provides an update on drilling, development and production operations at the Bualuang oil field in the B8/38 concession, offshore Gulf of Thailand. Salamander has a 100% interest in, and is operator of, the Bualuang field.
The installation of the oil processing and power generating modules onto the Bualuang Bravo Platform has been successfully completed. This included the lift and installation of the 1,200 tonne processing module and the 550 tonne power generation module. Hook up and commissioning of these modules will now commence.
The next in-field facilities installation will be the Bravo pipeline and FSO riser, to be installed in 2Q 2014. Switching the current FPSO for the new FSO, conversion of which is 60% complete, will take place over the summer 2014. With these new facilities in place, Salamander will be driving down the operating costs of the field by more than $20 million per year.
Appraisal & Development Drilling, Production Update
Producers have now been completed in previously undeveloped areas of the field, including the deeper T2 reservoir and into the central culmination of the East Terrace. The most recent well, B8/38-9, was a successful appraisal of the northern culmination of the East Terrace. This well found over 43 meters of oil pay in seven stacked sandstone reservoirs in the Miocene T4 and T5 intervals, with pressure data indicating a 14 meter column height in the key T4.1 reservoir. No reserves or resources are currently booked within the T4.1 and this northern culmination will be a target of a future producer as part of the current campaign.
At the beginning of this year, the field held certified 2P oil reserves remaining of 33.6 million barrels and 2C contingent oil resources of 12.1 million barrels, based on an estimated stock tank oil initially in-place (“STOIIP”) of 180 million barrels, representing an overall recovery factor of approximately 33%.
Since then, Salamander has collected a large amount of new well and production data from on-going operations. Detailed study of all field data has led management to estimate an increase of almost 40% in STOIIP from 180 million barrels to over 250 million barrels. Management expects this to lead to a substantial increase in contingent resources and ultimately to reserves and production growth. The Group’s independent reserves auditor is currently working on year-end reserve and resource certification.
Production from the field has averaged c. 12,300 bopd for 2013, and has been averaging approximately 12,700 bopd for December. Production is expected to remain broadly at these levels through 2014.
Future Development & Production Outlook
Engineering studies are underway to determine the optimal development plan and infrastructure requirements for the exploitation of the additional resources identified in the Bualuang field. Management expects the further development of the field to require at least one additional platform (“Charlie”) and more wells. Near-term, the Group is planning to add five additional slots to the Bravo platform in 2Q 2014.
Initial scoping work on the continued exploitation of the Bualuang resource envisages the installation of the Charlie platform in 2016. This would lead to a further production peak for the field, underpinning Group production growth to average over 20,000 boepd in 2017.
James Menzies, Chief Executive, commented:
“Successful development drilling which has brought new areas of the field on-stream, together with a major upward revision in our view of STOIIP and the smooth installation of new facilities has seen the value and future potential of the Bualuang field enhanced and been a real success story for 2013.
Having delivered a production increase of over 50% year on year, we are now focused on exploiting the additional resources and have started planning for a third platform that will lead to further production growth in 2016/2017. We also continue to evaluate step out exploration opportunities close to the field which may provide further near term drilling targets.”