East African Business Week (Kampala)
Edris Kisambira
7 April 2008
Kampala — Oil prospector Tullow Oil has commenced what they have called a major drilling campaign in the Butiaba area of the Lake Albert rift basin, targeting an reserve potential in excess of a billion barrels.
The drilling programme, in Uganda's western region which is scheduled to commence this month according to a company report for activities forecast for 2008.
Another company report for activity ending December 31, 2007 said recent onshore drilling activity has focused on the high impact Ngassa well targeting the largest structure in the basin with upside potential of 900 million barrels.
The well commenced in November 2007 but drilling difficulties resulted in the well being suspended in February 2008. "The substantial primary and secondary oil objectives remain un-drilled and it is now planned to drill Ngassa from an alternative location," the report reads in part.
In the onshore Butiaba region of Block 2 and Block 1, numerous prospects have been identified following analysis of recently acquired 2D seismic.
The report said the results indicate considerable prospectivity and a light rig, the OGEC 750, has been contracted to drill a programme of approximately eight wells commencing in April 2008.
This campaign will begin with the drilling of the Taitai prospect (previously Waki-2) and is targeting overall reserve potential in excess of a billion barrels.
In Block 3A, the Kingfisher prospect (part owned by Heritage Oil and Gas), with 300 million barrel upside potential, was drilled and tested in early 2007.
The Kingfisher-1 well intersected three significant oil-bearing intervals and tested at flow rates in excess of 14,000 bopd, though the well did not reach the primary target.
The Kingfisher-2 appraisal well is expected to commence in the second quarter of 2008 and the Nabors 221 rig is currently being mobilized from the Ngassa-1 drill site.
The recently acquired 3D seismic has also identified a number of additional offshore prospects.
Work is also at an advanced stage to contract a rig to drill the offshore prospects in Blocks 3A and Block 2 according to the report.
In addition to Ngassa and Kingfisher, the offshore Pelican prospect in Block 3A, recently covered by 3D seismic, is looking particularly encouraging with amplitude anomalies potentially indicative of hydrocarbons.
It is expected that the first offshore well will spud in early 2009.
In 2007, Tullow undertook an extensive exploration, appraisal and testing campaign in the Lake Albert rift basin.
All four wells drilled during the year encountered oil and an aggressive campaign is planned for 2008 focused on onshore and offshore drilling, seismic surveys and the anticipated sanction of the early production scheme (EPS).
"Overall, this programme is targeting significant oil resources with the ultimate aim of exceeding the threshold required for full development and export to international markets," the report, dated March 31 reads in part.
Tullow is working closely with the Ugandan government to achieve first production from the region via an EPS in the second half of 2009. The EPS will produce 4,000 barrels of oil per day to a new processing facility and power generation plant.
2008 Outlook
Tullow plans to invest over £325 million in its African business during 2008.
Approximately 35% of this will be spent on the exploration, appraisal and development programme in the group's Ghanaian acreage with the aim of approving full field development during 2008.
Activities in Uganda will focus on accelerated exploration and appraisal of the Butiaba area along with project sanction and the commencement of EPS development work and the drilling of the high impact Kingfisher well.
Elsewhere in Africa, ongoing seismic surveys and technical work are likely to lead to 2009 drilling in Tanzania, Madagascar, Mauritania, Angola and Gabon.
Tullow also has interests in two prospective blocks on the Congo (DRC) side of the Lake Albert Rift Basin, adjacent to the group's Ugandan acreage.
Tullow is currently awaiting a presidential decree on these blocks before any exploration work can commence and the full potential of this acreage can be realised.
The validity of the award of these licenses is currently being disputed by the Congolese Oil Ministry; this is being vigorously defended by Tullow and its partner.
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