It could be the biggest oil discovery in decades – and some of the globe’s major oil companies look set to grab a piece of the action.
BP Angola and Exxon Mobil Corp. were among companies awarded rights to explore offshore pre-salt blocks in Angola that may contain deposits to rival the biggest discoveries in decades.
In late January, Sonangol SA, the African nation’s state-run oil company, awarded 11 concessions to 13 explorers, also including Total E.P Angola, Statoil ASA and Chevron Corp. It was the first Angolan bidding round since 2007.
According to Carlos Saturnino, Sonangol’s Director of Negotiations, the start of oil exploration on the pre-salt layer signals an important landmark in the country’s history. “With the announcement of the results we are turning a new page. We’ll enter the pre-salt exploration. It is a different exploration, with participation of greater investments and also greater technological complexities,” Saturnino was reported as saying.
“The research and exploration of the 13 blocks demand resources - financial, human and technological - of a great dimension that we have never had before.”
Sonangol estimates that it will cost US$100 million to drill one pre-salt well. For that amount, it is possible to drill six or seven ordinary wells in Cabinda, which accounts for close to 60% of Angola’s oil production.
If the pre-salt proves successful, Angola can expect a significant production boost – and profit. Angola boasts a similar underwater rock formation to Brazil which, in 2007, made a pre-salt discovery of some eight billion barrels of crude oil in its Tupi field. Explorers say the Angolan field may hold as much as 124 billion barrels. “The comparison terms should be the Tupi pre-salt in Brazil. In Angola, we’re heading in more or less the same dimension,” says Saturnino.
The pre-salt layer is a geological formation on the continental shelf off the coast of Africa. The layer is of importance because it often holds significant petrochemical resources. It is found in the Angolan side between 2000 - 5000 metres below the level of the sea, with a high potential for hydrocarbon storage.
Angola, which rivals Nigeria as the top oil producer in Africa, suspended its last offshore bidding round in 2008 before the country’s first post-war general elections, but said last year that it was keen to develop its pre-salt blocks.
This major development will no doubt be a major topic of discussion at the prestigious Next Generation Oil & Gas Africa Summit 2011 which takes place at the Arabella Western Cape Hotel in South Africa from 5 - 7 April 2011. Particularly as some of the leading figures involved in the Angolan deal will be attending, including Noe Mateus, Geophysicist from BP Angola; Ivan Sandrea, VP Corporate Strategy from Statoil; Francisco Lopes da Cunha, Chief Geophysicist from Sonangol; Leonor Binga, Head of the Geophysics Department of the Exploration Direction from Sonangol, and Vincent Gervy, Deputy Head of Subsea Production Angola at Total.
The closed-door Summit, hosted by GDS International, will also tackle issues such as the changing drilling environment, seismic surveying and production optimisation, particularly as it relates to enhancing well productivity and reservoir management.