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Nic great posts, a breath of fresh air. However, a question...what is the impact of low owc on Lancaster overall? I get the point about drilling wells higher but on advfn, some are saying that if OWC above 1400m, a lot of the oil turns into acquifer....thanks!
@ADUK L8 was planned to be far offset from the current 2 producers (about 5kms away I believe). They would have needed a Pipelay vesel to put that long flowline just for one well. So, don't know that it was 180mn (I had more 120 in mind) but L8 would have been expensive and probably a fail because Dr T would have drilled it too deep. L8 was a terrible idea.
Nic. I’ve not seen the well plans for L8 but I’d obviously expect it to be above structural closure.
For those wanting to understand the effect on reserves and resources then the 2017 CPR covers it as the Lancaster low case. 25% reduction in reserves with an uncertain time to watering out of 6/7 wells. And a 70% reduction in resource.
@ADUK yes sidetrack from the 13-3/8” string. Yes, you need to shut down the field for a couple of weeks. But you get back to sustainable 20kbd and the payback is very quick, even with lost production.
7Z is too deep. Once water inevitably gets too high, sidetracking is by far the best, cheapest option.
Thanks again Nic 7760, really appreciate your post and some others too.
Cheers
Cap't Swag,
"I seem to recall the cost of well 8 being being over $180m."
Where did that absurd figure come from?
Nic,
Following your contributions as a 'new poster' with interest. However...
"7Z should be sidetracked (easy operation) and landed a bit further away from the 6"
'Easy operation' ? For starters, as you probably know, there's no such thing ! But where do you sidetrack from? Somewhere in the existent buildup section, ie the 9-5/8" casing? Whoops, problem there. Because that would mean running a smaller-diameter liner, and also the horizontal would have to be yet smaller.
OK, technically it would be 'easier' to P & A the entire horizontal and buildup, and sidetrack once more from around the 13-3/8" casing shoe and head off elsewhere. But at what cost? Any re-entry of 7z will entail considerable production shutdowns of BOTH wells, meaning loss of revenue to be added into the mix.
I don't like the idea of any such intervention, without even having tried to cost it.
But I still reckon it would be cheaper to drill a new well, keeping 7z going throughout, water-cut or no water-cut.
Which way - I seem to recall the cost of well 8 being being over $180m.
Nic. Lincoln they assigned P10 of 331 million at 1789 m OWC as I understand. This would be bigger now then I assume?
@Daveoilfriday Yes I can see a future. Now that we know what’s wrong, we’ll stop making the same mistake over & over again (drilling wells too deep)
@Pecten11 oil is probably present below structural closure. It’s just most likely tight, unable to flow. There is no successful proof of oil flowing below structural closure to date. Only traces and samples and such.
Disagree. L8 is way out and probably was planned to be below structural closure again. 7Z should be sidetracked (easy operation) and landed a bit further away from the 6 to minimise interference and most importantly shallower.
We know a lot more from 15 months of production and well tests now. It’s bigger than 62mn recoverable.
Nic. Hurricane assigned 62 million barrels to such an OWC back in 2014. If you are right im not sure if that figure would go up or down now that they have a better reservoir model.
Page 27:
https://www.hurricaneenergy.com/download_file/force/126/222
Nic. Agood realistic summary!
The next step is to answer the ‘so what’. To me they desperately need to drill a Lancaster 8 well rather than a difficult sidetrack likely necessitating several months shut down of production.
The difficulty is funding it and the tie back when the 6/7 wells could both struggle with increasing water cut. A new well with testing and tie back would probably cost the best part of $80m. With pressure from the bond I think they’ll struggle to afford that and depending on how 6/7 perform it will likely be a struggle to borrow on reasonable terms.
A willing and confident partner could cut a hard deal.....and unfortunately HUR might have few other options.
Insightful post. Even with higher OWC I remain hopefull HUR is worth "something" (i.e way more than 5p!).
I fully expect Septembers technical review to have some bad news (shallow OWC) but also remedial action (8 well or 7z sidetrack).
Give it 6-12 months and this should be back at 20p....
Nic, interesting post, thanks for contributing
How does your theory reconcile with the RNSd OWC for the wells? Though the info was released by Hurricane, I cant see that Schlumberger would have been happy with publication of a result that they didn't largely agree with?
Hi Nic7760,
Thanks for your input, I'm not technically up to speed with oil reservoirs etc. I've read many posts here and there seem to be a few differing opinions.
I trust your explanation, in your best opinion can you see a future for hur?
Reading your post does suggest so.
Thanks again
A breath of fresh air well played sir.
Hi guys, I'm posting for the 1st time on this board but I've been following you guys for a very long time and let's just say I'm intimately familiar with the HUR story (although not an insider, only working from public info).
I see a lot of discussions around the shallow OWC (ie. at structural closure) but it should be no surprise to technical people. It is actually the "Haha" moment we should all have been waiting for.
It explains pretty much all the unexpected things that have happened on the GLA and GWA over the last 4 years.
- Warwick Deep : drilled "deep", didn't flow, failed. Logic if the OWC is at structural closure. Drill underneath and you'll get a duster. No good alternative explanation from Dr T.
- The old vertical 7 well DST flowed good but only from a tiny zone at 1368-1376m TVDSS, ie. right above Lancaster structural closure at 1380m TVDSS. Everything undereath was tight. No explanation from Dr T.
- Lincoln Crestal was drilled at 1770m TVDSS, ie. above GWA structural closure at 1820m TVDSS (but not by much) and was a success
- Warwick West was drilled at 1840m TVDSS, slightly below structural closure and barely flowed.
- Halifax DST did not flow. Dr T blamed it on sticky mud. But it was cased down to 1179m TVDSS, below Halifax structural closure at 1040m TVDSS. So again, testing below structural closure failed. But there might be good pay above closure. We just don't know now...
- Then, the 6 and the 7z wells behave completely differently. 7z has a high water cut and had it almost from day 1, whereas 6 was dry for 6 months and only started to cut water when Dr T pulled too hard on it last Dec and January. But the wells are very well connected to each other and pressure communicates almost "instantly".
So what could explain such a difference ? Simple : 7z sits deeper than 6 and therefore has its "feet" in the water. That's why it's been sucking so much water all along. 6 is horizontal and at 1220m TVDSS, ie 160m above the OWC. 7z heel is at ~1300m TVDSS and its toe is at 1370m TVDSS, just 10m above the OWC.
So if the OWC is shallow, at ~1380m TVDSS, it should be absolutely no surprise that this well is sucking a lot of water from its toe. It should sidetracked and located at a shallower location in the future.
- The OGA has long been very skeptical of Dr T view of the deep OWC and therefore required him to prove it by drilling the deep commitment wells. I expect these to be cancelled now. This would have been completely pointless spending. HUR would have spent 100mn USD to just do several Warwick Deep failed DSTs...
The silver lining is : even with OWC at 1380m TVDSS, Lancsaster is still a large reservoir. All that needs to be done is drill the wells higher up in the structure. Dr T thought he was shooting for the middle but he was actually hitting the bottom of the reservoir or below it each time.
This admission by the company that the OWC is most likely shallow was THE missing element to fix things on the G