Since the 2007 discovery of the supergiant Tupi Field(see Hot Spot, this issue), the Santos Basin pre-salt discoveries just keep on coming. Over 30 wells have been drilled in the pre-salt region that encompasses both the Campos and Santos basins with a reported success rate of 87%, according to Security Exchange Commission information.
Petrobras, Brazil's premiere oil producer, has reported a 100% rate of success in their drilling activity in the Santos Basin pre-salt region, with "32% of the wells being economically viable."
With such great news the government was proposing a legal overhaul that would change the terms for oil companies investing in new offshore projects.
However, some problems have occurred.
First ExxonMobil reported their Guaraní test failed to find hydrocarbons in Block BM-S-22.
Then the news from BG that the Corcovado-2 test, drilled 14 km northeast of the Corcovado-1 discovery well, failed to test positive although they did have signs of natural gas during drilling. This is in addition to having to halt testing at the Corcovado-1 well because of higher than expected pressures.
A third blow has come with the 100% Petrobras well in Block MB-S-17 drilled in the southern fringe of the Santos Basin pre-salt province. While Petrobras has not made any announcements, it is a dry hole according to Brazil's National Petroleum Agency (ANP) sources.
Pre-salt reality check
Within 60 days and three high profile wells coming up dry, the Brazilian government remains optimistic. "Despite a series of dry wells in a promising offshore basin, Brazil's government maintains that the area holds a lot of oil and is a low exploratory risk for oil companies. We are going to continue doing our research with the conviction that the pre-salt is a province with a large concentration of oil," the Mines and Energy Minister Edison Lobão said.
"More drilling is the only solution to see if the potential is really worth the high investments to be made," says Nilo Chagas de Azambuja Filho, Vice President of High Resolution Technology (HRT). "With the data we have available, we know the area has high potential but there are uncertainties. It is a large area and we know that the geological conditions have some variation. By indirect methods, such as seismic, we have a good chance of finding oil. However, only by drilling more wells can the reservoir model be calibrated."
"There is a risk that Tupi reservoirs may not be as productive as it is expected, or on the other hand, even better than the initial forecasts which is why the companies are testing them," Nilo adds. "The volume of oil is huge. This is fact. The petroleum system is very active and the oil is good. The type of well, horizontal or vertical, or how long it will be productive are some of the questions that need to be answered before deploying a production system.
"However, the reservoir properties and the variability of the characteristics of the microbial limestone are the biggest uncertainties and pose considerable risk to the commercial productivity of the play."
Tupi confirmation and production
A third confirmation well has been drilled on the Tupi structure. Located 33 km northeast of the discovery well, it encountered good quality reservoirs and similar, high quality (28° to 30° API) in 2,140 m of water depth and 7,453 m total depth.
On May 1 of this year, the first oil was lifted from Tupi as part of an Extended Well Test (EWT) that could last 15 months. The Tupi Field was the first Santos Basin pre-salt discovery (see GEO ExPro vol. 5, no. 5, pp. 22-28, "Monsters of the Deep") announced as an oil discovery in late 2007. This is the largest oil field ever discovered by Petrobras in Brazil with an expected recoverable 5 to 8 Bboe. Along with Petrobras, BG and Galp Energia are partners in the exploration block.
Petrobras President and CEO José Sergio Gabrielli de Azevedo was particularly proud of the company's efforts "which led Petrobras, after detecting the Tupi reserves, to lift the first barrel of oil from it in a mere three years." The production testing was planned, according to Dr. Mauricio Werneck, Petrobras Manager Ultra-Deep Water R & D Program, in the spring of 2008. At that time Dr. Werneck said, "We are in the process of gathering data with long term or extended production testing necessary for the design of facilities, well spacing and reservoir maintenance. The extended well tests will last two years into 2010."
This testing is the first in the development of a new exploration frontier. According to Petrobras, the microbial-type carbonatic rocks that form the reservoirs are located 5,000 m from the seabed. Wells must cut through 2,000 m of salt into the reservoirs that are still not very well known in the industry. The great distances from the coast, about 300 km, will require new and complex logistics to not only transport people and equipment, but to store and offload production.
Importance of tests
Actually, the Tupi production tests are not the first in the sub-salt reservoirs. In September of 2008, Petrobras lifted the first sub-salt oil from the Jubarte Field in the Espirito Santo Basin. This testing served as a pilot project and source of information for Tupi. Differences between the two fields are their salt cover, 300 m at Jubarte vs. 2000 m at Tupi, and reservoir depths, Tupi being over 1,500 m deeper. Tupi is also a much larger field.
While production tests started May 1, they had to be suspended at the start of July because of technical problems reported in a sub-sea well flow control device. Tests resumed again in early September with production averaging about 14,000 bpd.
Once the extended well test is completed, the Tupi Pilot Project is expected go on line in late 2010, producing up to 100,000 bo and 4 MMm³ of gas per day.
What lies ahead?
Since the Tupi discovery and the series of discoveries that followed in the Santos Basin pre-salt reservoirs, a plethora of projections, comments, and articles have followed, mostly touting the huge potential of this area. However, the "real knowledge" is relatively small and is being kept most secret by Petrobras and its partners.
Nilo asserts that "more and more companies will go in search of the mysterious horizons of salt. The technology to develop production no doubt exists, but the problem is when you start to get into the details. The largest uncertainties are focused on development, more precisely the behavior of the reservoir."
"We know this is an area of high potential. It is a large area with variation in the geological conditions. The uncertainty lies in the variation. It is still early, there is much work ahead. There are doubts if the tank will yield enough to pay the high cost of the production system. We are talking about horizons over 7,000 m deep, 300 km from the coast in 2,000 m of water. There is a higher logistical cost to meet the production in this region," says Nilo Chagas de Azambuja Filho.