According to Tullow Oil the first successful oil production which was achieved on schedule within 40 months of discovery was also within estimated budget.
Commenting, Tullow Oil’s CEO, Aiden Heavey said “In 2010 we achieved exceptional exploration success and together with our partners delivered ‘First Oil’ on schedule in Ghana by year-end, and was within its original budget.”
According to the UK oil and gas explorer which owns majority share in Ghana’s Jubilee oil field, the largest oil field to be discovered in West Africa in the last 10 to 15 years, the final cost of the first oil production is “expected to be within 10% of the original $3.1 billion budget.”
This was revealed in Tullow Oil’s trading statement and operational update published January 27, 2011 on its website.
According to the statement, Tullow is expecting a full production capacity of 120,000 barrels of oil per day in the next six months.
“Current gross production is around 50,000 bopd from four wells and full production capacity of 120,000 bopd is expected to be reached within six months as the remaining five production wells are completed and brought on stream”, it said.
Production of oil from the Phase 1 development of the Jubilee field was inaugurated by the President J. E. A. Mills of Ghana in a First Oil ceremony on December 15, 2010.
After lifting the first 650,000 barrel cargo Jubilee crude oil on January 5, 2011, Tullow said a water injection to two wells which is currently 75,000 barrels of water per day and a further four water injection wells will be completed during 2011 to maintain production levels.
The statement however said a gas compression commissioning on the FPSO commenced in January with gas injection to the reservoir is scheduled to start in February 2011.
To help maintain field production levels and develop further reserves, Tullow is planning work for Phase 1a, of the Jubilee fields to comprise between five and eight infill wells which started in fourth quarter 2010 adding “It is anticipated that the investment decision will be made in third quarter 2011 following analysis of reservoir performance and submission of plans to the Government of Ghana.”
“A Declaration of Commerciality for the Mahogany-East discovery (previously known as “Southeast Jubilee”) was submitted by the Operator of the West Cape Three Points licence, in September 2010 and a Plan of Development is currently being prepared.”
The statement added that “The development of the Mahogany-East reservoirs, which are extensive but generally thinner than in the main Jubilee reservoirs, will be either a standalone development or a tie-back to the existing Jubilee field subsea infrastructure.”
Tullow however hinted that it is planning a secondary listing on the Ghana Stock Exchange.
In November 2010, Tullow announced that in order to create a more accessible opportunity for Ghanaian individuals and institutions to invest in the future of the oil industry.
“Originally planned for December, the Listing has been postponed due to the requirement over that period to focus on First Oil from the Jubilee field and year-end corporate planning”, Tullow said.
By Ekow Quandzie
ghanabusinessnews.com
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