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Saturday, March 15, 2025

BHP finds gas in all appraisal wells at Calypso development

by

Curtis Williams
1128 days ago
20220210
The BHP Billiton building in Port of Spain.

The BHP Billiton building in Port of Spain.

SHIRLEY BAHADUR

Cur­tis Williams

Good news from BHP Bili­ton, as the com­pa­ny is re­port­ing that all of its ap­praisal wells in its Ca­lyp­so de­vel­op­ment, north of To­ba­go, have en­coun­tered hy­dro­car­bons.

In its op­er­a­tional re­view for 2021 the com­pa­ny said, “In Trinidad and To­ba­go, the Ca­lyp­so ap­praisal drilling pro­gramme con­clud­ed on De­cem­ber 20, 2021. All wells en­coun­tered hy­dro­car­bons.”

It al­so had fur­ther en­cour­ag­ing news say­ing two of the wells ac­tu­al­ly en­coun­tered zones not be­fore seen.

The re­port read, “Bon­gos-3 con­firmed vol­umes downdip of pri­or pen­e­tra­tions and Bon­gos-4 es­tab­lished vol­umes in a new seg­ment. The well re­sults are cur­rent­ly un­der eval­u­a­tion and will be in­cor­po­rat­ed in­to the de­vel­op­ment plan.”

Last year the com­pa­ny’s Coun­try Man­ag­er for T&T, Michael Stone told Guardian Me­dia that the ap­praisal ac­tiv­i­ty in Ca­lyp­so would help de­ter­mine the ac­tu­al size of the dis­cov­ery it made in its North­ern Li­cense.

Stone said, “We have an­nounced pub­licly a 3.5 tcf dis­cov­ered re­source, but be­gin­ning in the mid­dle of this cal­en­der year, hope­ful­ly June or Ju­ly, we are go­ing to have an ap­praisal pro­gramme, sub­ject to the rig be­com­ing avail­able to us, that is what the tim­ing is de­pen­dent on, it is that ap­praisal pro­gramme Cur­tis, that is go­ing to help us do that very de­lin­eation.”

He added, “So we would ex­pect on the back end of that de­lin­eation pro­gramme, to­wards the end of the cal­en­der year, we will be in a po­si­tion to be clear­er on the re­source size and of course there will al­ways be a range and we are hop­ing if suc­cess­ful to add to the 3.5 dis­cov­ered re­source that we have an­nounced pub­licly.”

Stone said the plan re­mained to have some of the nat­ur­al gas sold in­to At­lantic LNG and then ex­port­ed to glob­al mar­kets. He ex­plained that due to the com­plex­i­ty and cost of deep-wa­ter drilling and pro­duc­tion, it made sense to pro­duce part of it for LNG.

“A re­source of this size and scale and in ad­di­tion a deep wa­ter re­source, I mean a deep wa­ter re­source, of course car­ries a dif­fer­ent cost struc­ture just by na­ture of the deep­er wells and com­plex in­fra­struc­ture re­quired to bring it to shore, yes LNG is go­ing to be an im­por­tant com­po­nent of the Ca­lyp­so de­vel­op­ment. It is go­ing to be nec­es­sary for some com­po­nent of that gas to make it in­to the in­ter­na­tion­al mar­ket to at­tract and in­ter­na­tion­al in­dexed price, so yes LNG is an im­por­tant part of the Ca­lyp­so de­vel­op­ment.” Stone ex­plained.

He said the com­pa­ny was hop­ing that the blocks that were ad­ja­cent to the Ca­lyp­so field, but were in Bar­ba­dos wa­ters, woild al­so prove to be suc­cess­ful.

BHP al­so in its re­view not­ed that crude oil prices have re­cov­ered to above US$70 per bar­rel as 2022 opens.

“We be­lieve fur­ther gains from here are pos­si­ble giv­en our con­struc­tive view of de­mand tail­winds. How­ev­er, fu­ture de­vel­op­ments in price are al­so ex­pect­ed to re­ly in large part on the rate at which cur­rent­ly cur­tailed sup­ply re­turns, which is high­ly un­cer­tain. Look­ing be­yond this phase, our bot­tom-up analy­sis of de­mand, al­lied to sys­tem­at­ic field de­cline rates, points to a long run struc­tur­al sup­ply-de­mand gap. Con­sid­er­able in­vest­ment in con­ven­tion­al oil is go­ing to be re­quired to fill that gap and main­tain mar­ket bal­ance. If that in­vest­ment is not forth­com­ing in a time­ly way, the pos­si­bil­i­ty of oil prices in­creas­ing ag­gres­sive­ly can­not be ruled out,” the com­pa­ny not­ed.

In terms of LNG, BHP said the Japan-Ko­rea Mark­er price for LNG was ex­tra­or­di­nar­i­ly volatile across the 2021 fi­nan­cial year. The mar­ket bal­ance it said shift­ed from heav­i­ly over-sup­plied to ex­treme­ly tight go­ing in­to the North­ern hemi­sphere win­ter. Since that time, prices have re­mained el­e­vat­ed rel­a­tive to sea­son­al norms, with ro­bust de­mand com­bined with on­go­ing sup­ply out­ages.

“Longer term, we be­lieve the com­mod­i­ty of­fers a com­bi­na­tion of sys­tem­at­ic base de­cline and an at­trac­tive de­mand tra­jec­to­ry. With­in glob­al gas, LNG is ex­pect­ed to gain share due to in­dige­nous sup­ply de­ple­tion and/or com­pet­i­tive­ness vis-a-vis pipeline im­ports in some re­gions. Against this back­drop, as­sets ad­van­taged by their prox­im­i­ty to ex­ist­ing in­fra­struc­ture or cus­tomers, or both, in ad­di­tion to com­pet­i­tive emis­sions in­ten­si­ties, are ex­pect­ed to be at­trac­tive,” BHP end­ed.


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