QGEP strikes big in Atlanta

February 6, 2014

Results of the first well drilled in the Atlanta post-salt oil field off Brazil were better than operator Queiroz Galvão Exploração e Produção (QGEP) and its partners anticipated, according to an announcement the Brazilian company made Wednesday.

Located in Block BS-4 in the Santos Basin 185km out from the city of Rio de Janeiro, horizontal well (7-ATL-2HP-RJS) is in around 1500m of water. The horizontal well was drilled to a section length of 750m and a diameter of 9.5 inches. A sand reservoir was found with average porosity of 38%.

High permeability was also confirmed, with an oil quality of 14º API.

"Production test results came in at the high end of our expected range, confirming the potential of the Atlanta Field," Danilo Oliveira, QGEP’s production director, said.

Productivity index tests were also higher than anticipated, with the “excellent results,” with the battery of tests pointing to the well producing close 12,000 bo/d when brought online under normal operating conditions.

Drill stem testing (DST) was carried out with two flow periods of differing restriction levels, producing flow rates of 1250 bop/d and more than 5000 bo/d, respectively. Oliveira touted the DST as “highly successful.”

The horizontal section of the well was cased with screens and packed with gravel, and QCEP plans to immediately initiate the second horizontal well of the early production system (EPS). The company also announced that it will quickly launch tender for FPSOs to either cover ongoing operations in the EPS or to launch into full development of the field. The decision on which FPSO will be hired will be based on the results of the tender and the impact on the economics of the project.

The company said that first oil is anticipated in late 2015 or early 2016. It is eyeing 2017-2018 to introduce its definitive production system and plans for an 80M-100M bo/d-capacity FPSO to cover a total of 12 wells.

In August 2011, QGEP bought Shell's stake in Block BS-4 in August 2011 for US$157.5MM, calling the block “an excellent addition to [its] portfolio.” In addition to the Atlanta field, Block BS-4 also encompasses the Olivia field. The company said in an earnings release that the two fields housed combined volumes of more than 2.1 billion bo in place.

Petrobras sold its 40% stake in November 2012 to Brazil’s OGX Petróleo e Gás. In late December 2013, Brazilian regulator Agência Nacional do Petróleo, Gás Natural e Biocombustíveis threatened to revoke OGX’s concession, since the troubled company had neglected to pay $30.2MM in expenses.

A spokesperson for QGEP declined to comment on OGX's standing in Block BS-4.

Queiroz Galvão Exploração e Produção S.A. is the operator of Block BS-4 with a 30% stake; OGX Petróleo e Gás S.A. holds 40% and Barra Energia do Brasil Petróleo e Gás Ltda. holds the remaining 30%.

Read further coverage on QGEP's activity off Brazil.

Map courtesy QGEP.



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