21st Oct 2015 11:10
LONDON (Alliance News) - Oilex Ltd Wednesday said it has started a workover campaign on the Cambay field in India and said the construction of the production facility for Bhandut-3 is progressing well.
The Indian-focused gas producer said it has mobilised a rig to the producing Cambay-19z well. The workover includes removal and cleaning of the production tubing and repositioning the downhole pump to improve well deliverability.
Following that well, Oilex will move the rig to one of four potential locations. The order it completes the workover on the four wells will depend on what necessary components have been delivered to the site and on optimising the rigs uptime.
The four other workover wells will be:
- Cambay-20, which requires a downhole pump to improve deliverability.
- Cambay-70, which is located adjacent to the Cambay 77-H well.
- Cambay-60, which has been flow tested but never placed onto production.
- Cambay-77H, which needs the frack tree removed and production tubing fitted.
The workover programme is expected to be completed before it drills the next two wells on its acreage, Cambay-78H and Cambay-80H, it said.
In addition, Cambay-73 continues to produce gas for customers in the immediate vicinity of the project, producing around 20.0 barrels of oil equivalent per day. Production is limited whilst Oilex studies the reservoir and once the Cambay-77H well workover has been completed, it will be connected to the pipeline that services the Cambay-73 well, meaning it will not have to construct a separate production facility for Cambay-77H.
The Cambay-60 well may also be connected to Cambay-73's production facilities. That would mean the production flowing through those facilities would be in the range of 130.0 to 170.0 barrels of oil equivalent per day once the workover programme is completed.
Separately, Oilex is finalising the contracting and procurement phase for the 2015 to 2016 drilling programme on the Cambay field. However, it said the drilling of the first well "may slip into" the first quarter of 2016 rather than its original target to have drilling underway by the end of 2015.
"The commencement of field activities to boost production through the workover campaign is another milestone towards our goal of being operationally cash flow positive in India (exclusive of workover and drilling capex) before the end of this calendar year. In addition, the approvals tendering and cost recovery process is nearing completion for the 2015/16 drilling campaign," said Oilex.
At the Bhandut field, field construction is around 40.0% completed and expected to be finished in November and the infrastructure required to transport gas from the field, which is the responsibility of a third party, is expected to be completed before the end of December. The Bhandut-3 well on the field is expected to produce around 100.0 to 130.0 barrels of oil equivalent per day.
"We are looking forward to Bhandut recommencing production and the final independent reserves report being completed. The gas market in India remains robust driven by market fundamentals and it is important to capture the commercial benefit of lower contractor service prices currently prevalent in the market," it said.
Oilex shares were down 10.5% to 1.37 pence per share on Wednesday.
By Joshua Warner; [email protected]; @JoshAlliance
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