BAKU, Azerbaijan, Nov.15
By Leman Zeynalova – Trend:
During 2019 and 2020, it is estimated that $ 3.5 million will be spent by Canada’s Zenith Energy company for upgrading the gathering system and central facilities in Azerbaijan to improve safety, efficiency and handle higher production rates, Trend reports citing the company.
“From 2020 through 2024, 3D seismic programs are expected to be performed in order to fully delineate the various pools and target formations to optimize the selection of drilling locations. Development drilling will commence in 2019 and continue to 2035,” Zenith Energy, which is the operator for development of Muradkhanli-Jafarli-Zardab block of fields onshore Azerbaijan, said in its report.
It has been estimated that each well in the proved case will cost $4.3 million, said the company.
“This cost will include the direct cost of materials, fuel, salaries, etc. to drill the well as well as an allocation for the purchase of one drilling rig, well completion and tie in. Each well in the proved plus probable case is expected to cost $5 million. In addition to the costs anticipated for the proved wells, wells in proved plus probable category have an additional allocation of the periodic leasing or contracting of additional drilling rigs and expansion and modernization of the field facilities,” said Zenith Energy.
“In all, 147 wells are expected to be drilled, 58 of these are anticipated to be horizontal wells. Most horizontal wells will have two legs of about 1,600 m.”
Azerbaijan’s state oil company SOCAR and Zenith Aran Oil Company signed a Rehabilitation, Exploration, Development and Production Sharing Agreement (REDPSA) in March 2016 for a block that includes the Muradkhanli, Jafarli and Zardab oil fields. Zenith Energy Ltd established its subsidiary company Zenith Aran Oil Company Ltd for production operations in these three fields. Production under the agreement began in August 2016.
Zenith holds an 80-percent participating interest in the three fields within the contract area, while SOCAR retains the remaining 20 percent. The agreement is for 25 years, with a potential extension by five additional years.
The total area of the Muradkhanli, Jafarli and Zardab fields is 642.2 square kilometers, and according to the contract, it is divided into rehabilitation and exploration territories.
The Muradkhanli-Jafarli-Zardab block is located in the Yevlakh-Agjabadi oil and gas region of Imishli district of Azerbaijan. The Muradkhanli field was discovered in 1971, Jafarli - in 1984, and Zardab - in 1981.
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