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Bahrain outlines crude and gas discovery

04 Apr 2018 13:53 (+01:00 GMT)
Bahrain outlines crude and gas discovery

Dubai, 4 April (Argus) — Bahrain's recent offshore discovery of oil and gas will be in production inside five years, boosting the Mideast Gulf country's output from a current 43,000 b/d, excluding the volumes it receives from the Saudi-operated Abu Safa field.

But the likely scale of future production is not yet clear. The enormous estimated volume of 80bn bl of crude provided by consultants DeGolyer and MacNaughton is not of recoverable reserves of conventional crude but rather a 50pc probability assessment of resources. Resources are estimates of volumes physically contained in a source rock while reserves are volumes that can be expected to be produced from a technical and commercial point of view. The crude resources "could be classified at the edge of the conventional-unconventional type of plays", said drilling contractor Halliburton.

The discovery, in Khalij al-Bahrain Basin, is located in shallow waters off the Kingdom's west coast, close to a fully-operational oil field with ready-to-connect-to facilities.

Bahrain's state-owned oil company Bapco said it has already produced "high-quality oil" from the wells during the testing and flow back phases but gave no further details.

Bahrain's National Oil and Gas Authority (NOGA) is now working on the next stage of development, focusing on developing a commercial framework and putting terms in place to attract international partners.

NOGA also confirmed separate discovery of significant gas reserves in two accumulations below Bahrain's main gas reservoir. It said that extensive work has already been carried out to evaluate the in-place volumes. The gas reserves are put in the region of 10 trillion-20 trillion ft³.

"Agreement has been reached with Halliburton to commence drilling on two further appraisal wells in 2018, to further evaluate reservoir potential, optimise completions, and initiate long-term production," said Shaikh Mohammed bin Khalifa al-Khalifa, Bahrain's oil minister.

The first well in the drilling programme is expected to start producing in August. Drilling over the next two years will focus on maximising production and commercial efficiency.

The discoveries are expected to support Bahrain's downstream expansion, which includes state-owned refiner Bapco's plans to raise capacity at its 262,000 b/d Sitra refinery to 360,000 b/d in 2022.

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