Royal Dutch Shell is about to complete its second well in the Northeastern Mediterranean (NEMED) offshore deepwater block, MEES understands.
The drilling of the first well in the most northern block of Egyptian waters commenced on Christmas day.
There is keen interest in neighboring Cyprus, Israel and Palestine in the results to be announced shortly from these two wells, which are the first in deep water in the east Mediterranean.
The May 2000 issue of Shell in the Middle East quoted both Roger Patey, Chief Executive of Shell Egypt NV and country chairman for Shell in Egypt, and Marcus Schwander, project manager for the NEMED concession, as saying that “the prospects are very bright as initial estimates are that the concession could hold reserves of at least 15 trillion cubic feet of gas and over a billion barrels of oil.”
Mr Schwander added that “first production of either gas or oil from the NEMED concession is not expected until 2005 or 2006 if all goes according to plan – which I am sure it will.”
Under the production-sharing agreement for the block signed by the Egyptian Government and Shell in March 1999, Shell agreed to pay a signature bonus of $35mn and spend $140mn over an initial five-year period, with a commitment to drill five wells.
There is an option to extend the exploration period for two years, spend $50mn and drill four wells. A third extension option also calls for expenditure of $40mn and the drilling of two wells.
In January 2000, Shell farmed out 25 percent of its share in NEMED to ExxonMobil while remaining as operator with a 75 percent stake in the block, which has water depths ranging from 2,600ft to nearly 9,800ft (800-3,000ms).
The concession covers an area of 41,500 sq km and is located approximately between latitude 32º 30' and 33º 30'and longitude 30º to 33º.
Its southern boundary runs along the entire northern border of three concessions that are considered rich gas prospects: BG’s West Delta Deep Marine concession; BP’s West Mediterranean Deep Water concession; and Eni’s East Delta Deep Marine.
Shell has shot 2D seismic covering the entire block, as well as 3D seismic covering an area of around 7,000 sq km – the largest 3D seismic survey ever undertaken by Shell.
According to Mr Schwander, “the 2D seismic survey provided us with a series of vertical slices through the sub-surface and revealed a completely new geological picture, providing us with information that has shown us that we may be dealing with a completely new oil and gas province for Egypt which should prove to be extremely productive.”
He added: “Once we had completed the interpretation of the 2D seismic survey data, we were able to select an area of some 7,000 sq km at the southern end of the concession, in front of the Nile Delta, which is 160km in length in an east-west direction and 50km wide in a north-south direction.
This area contains several different geological domains of the concession which, on analysis, appear to offer us the best prospect to test the presence of hydrocarbons, both oil and gas.”
Last year (MEES, 7 February, 2000), a Shell executive told MEES: “Usually with seismic you still aren’t sure, but the seismic we have done points very strongly to hydrocarbons in the concession. We are very encouraged by it.
The hope is that in the deeper waters, beyond where we see the gas, that even further out we will see different types of plays in the deep water which may lead to more oily type plays.
Our explorers will not push it internally, but there are indications that there is oil, as the geology does change fairly drastically out into the deeper waters.
We see the gas prone geology extending into our block and then it changes quite drastically and then it starts to look almost exactly like the geology of the Gulf of Mexico. Interesting structures that look very attractive.”
Shell has not released information as to the exact location of the two wells that have been drilled back to back in the past seven weeks.
However, since the 3D seismic focused on the southern part of the block, it is presumed that the drilling took place in that general area.
(mees)
© 2001 Mena Report (www.menareport.com)
