31 March 2017, Sweetcrude, Abuja — Eland Oil and Gas Plc said it has produced over 330,000 barrels of crude oil from only one well in Oil Mining Lease (OML) 40 since the beginning of the year.
The company further stated that it intends to start the work-over and side-track of the Opuama-7 well before the end of the first half of 2017.
The company said OML 40, through the Opuama-3 well, has produced 330,000 barrels since production restarted in January after production was temporarily halted to allow maintenance on the floating production, storage and offloading vessel.
Commenting on the development, Chief Executive Officer, Eland Oil, said, “The achievement of getting 120 meters ocean going oil tankers to run a continuous cycle through the Nigerian river system should not be underestimated and whilst we will continue to implement operational efficiency we could not be more delighted and excited with the way it has begun.
“The success of establishing an alternative export route has considerably de-risked our crude monetisation and has ensured that we will never again have lengthy production downtime that resulted from a single route to market.
“2017 brings huge opportunity for us to significantly increase production, capitalising on our earlier success from the re-entry programs, prior to new drilling opportunities.”
The company explained that the well has been choked back so the reservoir can be optimised, with output averaging around 8,000 barrels each day.
It added that since the restart, 160,000 barrels of crude oil had been delivered to the export terminal and a further 160,000 barrels is expected to be injected imminently.
It said, “The company has monetised 154,173 barrels of crude at an average price of U$52.14 per barrel, with cash receipts of over $8.0 million. The company expects to monetise the next 160,000 barrels in the coming weeks.”
The company explained that during the downtime of the FPSO, Eland reviewed its shipping operations, while it added that modifications of the mooring system had since been implemented to cater for the tides and increased volumes being delivered to the storage tanker.
“The company expects to resume production by the end of next week. Water handling at Opuama field will commence in April through the installation of a three-phase separator, allowing the commencement of production from well Opuama-1. Production is expected to be about 11,500 barrels per day from Opuama-1 and Opuama-3 following the resumption of production and optimising,” Eland added.
The company explained that its cash stands at about $9.0 million ahead of the drilling of Opuama-7, which is forecast to add 6,000 barrels to daily production, while it added that Gbetiokun-1 would also be worked over in the second half of 2017, adding a further 7,800 barrels to daily production.
Furthermore, the company said it expects to begin development of the Ubima early production system at the end of the Nigerian wet season in September and upon completion of road and well-site preparation.
Eland said it has looked at how best to fully develop the Gbetiokun field, adding that an initial development comprising six new production wells targeting the deeper reservoirs, together with Gbetiokun-1, is forecast to produce more than 50 million barrels of oil.
“A second phase of development, comprising six further production wells targeting the shallower reservoirs, has the potential to produce a further 15 million barrels. Eland’s reservoir models indicate that these wells could deliver a peak production rate of over 50,000 barrels per day,” company explained.