Australian independent Santos is looking to quickly develop the Dorado discovery off Western Australia once it completes its US$2.15 billion takeover of current operator Quadrant Energy.
Speaking at the RIU Good Oil Conference in Perth on Wednesday, managing director of Quadrant’s joint venture partner Carnarvon Petroleum, Adrian Cook, told delegates a final investment decision on the discovery could be made as soon as 2020.
Cook said Santos had indicated in conversations with his company that they were keen to get the oil in Dorado into production and re-invest the cashflows generated back into producing the gas and condensate that also sits in Dorado as well as the nearby Roc resource.
“As a company with a limited balance sheet, that is absolutely music to our ears,” Cook said.
“We understand at the moment that the plan is to drill two appraisal wells next year … and then Santos talked about wanting to have a final investment decision for this in 2020, which suggests we’d want to move fairly quickly to get onto production and again something that the board of Carnarvon would be really keen to endorse.”
Carnarvon believes Dorado is the third largest discovery in the history of the North West Shelf, with an estimated contingent resource of 171 million barrels of oil on a proven plus probable basis, along with 16 million barrels of condensate and 552 billion cubic feet of gas.
Regardless if Santos completes its takeover or not, Cook said he would push for whoever is the operator to consider drilling Roc South as the first follow up well to Dorado next year.
“It’s beside Dorado and there’s the potential for it to actually be connected at least across a couple of sands with Dorado,” he said.
“It’s also a stacked pay target like Dorado to which I personally hope we see again a number of oil sands in this target.”
The second well Carnarvon will push the operator to drill would target Roc South-East which Cook said was smaller but also ran around the ridge that seals and holds the oil and gas in Dorado.
Beyond those wells, Carnarvon has also identified several other leads close to Dorado including Pavo which Cook said the company still needed to do more work on.
Perhaps the most exciting prospect near Dorado however is Apus, which Cook said had the potential to dwarf the recent discovery.
“It’s on 2D so it needs 3D seismic acquired over it but it certainly a very, very large and interesting structure sitting on 2D data,” he said.
When questioned over the potential size of Apus, Cook responded: “Apus is a funny one because the numbers are so big that we have to actually do a fair bit more work on them because they are almost unbelievable, but we are absolutely working on them and we will get them out in the next couple of weeks.”
Cook also confirmed that the 2014 Phoenix South discovery which started the successful campaign in the Greater Phoenix Area had fallen down the development pecking order behind the Dorado and Roc discoveries.
“Phoenix South, the wells that were drilled there clearly show us that there’s hydrocarbons [but] I think it’s not too wrong to say that the reservoir isn’t as stellar as what we’ve seen at Dorado,” Cook said.
“I think it’s the sort of thing that we will go back to once we have infrastructure in place and once we’ve tested some of these nearer term prospects and leads.”
Roc-1 and Roc-2 have been estimated to hold 332 billion cubic feet of gas and 20 million barrels of condensate, while Phoenix has been estimated to hold 7 million barrels of oil.
Quadrant currently operates the Greater Phoenix discoveries with an 80% interest, and Carnarvon holds the remaining 20% equity.
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