BP Starts Up Oman's Khazzan Under Budget
Gas production has begun at Phase 1 of the giant Khazzan tight gas field in Oman, under budget and beating the official 4Q2017 target date, said its operator BP September 25. The UK major is working in partnership with Oman Oil Company Exploration and Production.
Oman's oil minister Mohammed Al Rumhy said the project would "realise more gas reserves and more production of gas that our country needs to support our energy planning and requirements.” In May, Oman said that Khazzan would start up as soon as this September.
BP CEO Bob Dudley said: “The start of production from Khazzan, BP’s sixth and largest major project start-up so far this year, is an important milestone in our strategic partnership with Oman. With further development already planned, this giant field has the potential to produce gas for Oman for decades to come.”
BP expects to start-up seven upstream major projects in 2017, the last being the Eni-operated Zohr giant gas field offshore Egypt. These projects are expected to make a "significant contribution to the 800,000 barrels of oil equivalent/day of production that BP expects to add by 2020," it said.
“Khazzan further demonstrates BP’s ability to consistently deliver large, complex projects on schedule and within budget while applying the industry-leading skills and technology we’ve developed globally,” Dudley added. “In this case, tight gas techniques we perfected in the US have been brought to Oman and we are very pleased with the results.”
The tight gas reserves lie at depths of up to 5 km in narrow bands of extremely hard, dense rock, requiring specialised drilling equipment, the precise drilling of both vertical and horizontal wells, and well stimulation to free the gas.
The gas will develop petrochemical and other downstream industries, Oman said.
The production sharing agreement for Block 61, which contains the Khazzan field, was first signed in 2007 and was amended in 2013 and extended in 2016. Appraisal over 2007-2013 confirmed the existence of significant tight gas resources that could be developed through the application of BP’s extensive unconventional gas experience and technology. The first phase of development of the field was sanctioned in December 2013.
Phase 1 of the Khazzan development is made up of 200 wells feeding into a two-train central processing facility and is expected to plateau at 1bn ft³/day.
Once the second phase of the Khazzan is fully up and running production is expected rise to 1.5bn ft³/d. In total, about 300 wells are expected to be drilled over the estimated lifetime of the Khazzan field. Phases One and Two will together develop an estimated 10.5 trillion ft³ of recoverable gas resources.
Drilling efficiency has increased significantly during the development of the project. The average time to drill and complete a vertical well was reduced by 27% and a record time of 60 days was achieved for completion of one well.
About 38% of the total contract spend to date has been awarded to local oil and gas services companies.
William Powell