South Pars looks for drilling company for buy-back
17 November 2000
State-owned Pars Oil & Gas Company is about to select a rig company
to drill two delineation wells at the South Pars offshore oil field in
preparation for a buy-back tender scheduled for spring 2001 for the long-delayed
South Pars Oil project.
Bidders for the drilling rig are the European arm of Schlumberger, the
state National Iranian Drilling Company (NIDC) and Naftkav Engineering
Services Company, an affiliate of the National Iranian Oil Company (NIOC).
Naftkav has submitted the lowest bid, Pars Oil sources say.
Pars Oil managing director Assadollah Salehiforoz said on 7 November
that the rig is expected to start drilling in one month, moving to another
location within another three months. One delineation well, 900 metres
deep and 800 metres along a horizontal path, has just been drilled by Schlumberger
and tests are being carried out to determine flow rates, says Salehiforoz.
The delineation wells, which are in addition to earlier exploration
drilling, will allow South Pars to retender the offshore oil field project
after a lengthy suspension. Denmark's Maersk Oil & Gas, at the head
of a consortium comprising France's TotalFinaElf and the local Petro Pars;
Norex of Norway; and Malaysia's Petronas were among firms taking part in
a first round of bidding in 1999, but talks ground to a halt because of
uncertainty over reserves at the South Pars oil field, which is near the
South Pars gas field (MEED 25:8:00).
"The bidders were factoring in a very high risk factor, so we had
to establish better parameters," says Salehiforoz.
It is uncertain that any of the first round bidders are still interested.
Maersk suggested in April it had lost interest, while Norex said in August
it was still interested.
A tender issued in spring 2000 will include facilities for early production
of 30,000-50,000 barrels a day (b/d) within one year of start of work,
according to Salehiforoz. Output is to reach a peak of 75,000-100,000 b/d.
About 95 million barrels of crude is to be produced over the first five
years; water injection will thereafter be required to maintain pressure,
Pars Oil sources say.