Bhandut Overview

Cambay Basin Location Map Infrastructure and Oil and Gas Fields thumb

A Isochronal production test of Bhandut-3 flowed at a maximum rate of 6.5MMscfd (184,370m3/d) through a 10mm choke with a flowing tubing head pressure of 1,190 psia. The isochronal test was conducted to obtain more precise reservoir performance data as part of attempting to realise value from Bhandut and the test confirmed the reservoir sand has a permeability of 124mD, making it a conventional reservoir.

In December 2014 Oilex received endorsement from the Government of India for the sale of gas from the Bhandut-3 well, which is located within the Bhandut Field. This is a critical milestone for returning the field to production, supplying gas to the local market and generating cash flow for the Company from a previously idle asset.

IN DEPTH

The field is located near to the Lakshmi, Gauri and Hazira Fields that are producing gas and oil from reservoir intervals similar to those intersected in the Bhandut wells. The field was discovered and developed initially by ONGC of India. Hydrocarbons were found in Oligocene and Eocene sandstones and continued to be produced on an intermittent basis after the fields were acquired by the GSPC and Niko Joint Venture in 1995.

The Bhandut Field has produced about 172,000bbls of oil since 1988, including 17,572bbls since acquisition in 2007. Individual wells have produced at rates of 200-400 barrels of oil per day in the past.

Figure 2 - Potential for additional channel reservoirs

The first 3D seismic survey over Bhandut field was acquired in February 2007. The main reservoir units in the shallower section are discontinuous sandstones and at deeper stratigraphic levels, exploration targets that are likely to be gas-bearing will be considered for drilling in the future.

The Bhandut-2Z well was drilled in October 2007 and modern core, velocity, wireline log and pressure data have been acquired from the well to confirm the seismic correlation to locate future wells on the field. Deeper reservoir objectives have also been identified at Bhandut may be drilled subsequent to reprocessing of 3D seismic and reinterpretation of the new data.

In August 2013 an isochronal gas production test was undertaken at Bhandut-3 as part of the approved work programme and budget. Bhandut-3 flowed at a maximum rate of 6.5MMscfd (184,370m3/d) through a 10mm choke with a flowing tubing head pressure of 1,190 psia. Bhandut-3 is a lean gas composition with 98.9% hydrocarbons, of which 94% is methane, and 1.1% is inert gases (Nitrogen and Carbon Dioxide). As such minimal treatment is required to be suitable for sale. Minimal capex, if any, is expected to be required by Oilex under such a production scenario.

CURRENT STATUS

Production of gas commenced from the Bhandut Field early in the June 2016 quarter.  Production from the Bhandut-3 well averaged 503 mscfd with 18 bpd associated liquids (87 boepd; Oilex net 35 boepd) during the quarter.  The field is being closely monitored while an extension of the permitted production plan is being approved. While tubing head pressure at the well has been maintained, formation water production has increased resulting in a decline in gas production.

Oilex is Operator and holds 40% equity in the Bhandut Field, with Gujarat State Petroleum Corporation (GSPC) holding the remaining participating interest.  Previous drilling in the Bhandut Field intersected a number of hydrocarbon zones, some of which have been produced and are now shut-in. The Bhandut-3 well commenced production from a previously undeveloped sandstone at a depth of 1,010 metres at virgin reservoir pressure.

Gas produced from Bhandut-3 is initially processed at the on-site production facilities and then delivered to a third party operated gas processing plant where it is further treated to the required pipeline specification.  It is subsequently compressed for entry into the high pressure gas network for delivery to an end user.

Currently the JV has approval to sell test gas from this project until 5 October 2016 pending completion and approval of a FDP. During this period, Oilex shall be submitting an FDP on single well basis and seek GoI permission for commercial gas sale.  In case the FDP is approved earlier than 5 October 2016, Oilex will switch over to early commercial gas production.

Currently the Bhandut Petroleum Mining Lease (PML) is valid until 22 September 2016.  An extension application for three years starting from 23 September 2016 has been submitted to the GoI.

Timeline

  • 2015  
    • Q2
      Production started at Bhandut EPS
  • 2014  
    • Q4
      Bhandut-3 - Gas Sales Agreement Endorsed
  • 2013  
    • Q4
      Seismic reprocessing
    • Q4
      Gas Sales Agreement
    • Q2
      Bhandut-3 flowed tested at a maximum rate of 6.5MMscfd (184,370m3/d)
  • 2011  
    • Q4
      Bhandut field shut in, oil depleted
  • 2007  
    • Bhandut 2z was drilled
    • 3D Seismic Survey Conducted
  • 2006  
    • Oilex Acquired the field
  • 2004  
    • Bhandut 6 was drilled
  • 1997  
    • Bhandut 3,4,5 were drilled and test
  • 1995  
    • GSPC and Niko Joint Venture Acquired the field
  • 1991  
    • Bhandut 2 was drilled and put on production
  • 1988  
    • First production from Bhandut 1
  • 1976  
    • Field discovered by ONGC