12-8-E More Wells Possible Immediately after A8?

12-8-E More Wells Possible Immediately after A8?

The production platform has 12 slots. They have used 8 (including A8).

They have room for 4 more production wells.

Possible Phase 2 and 3 depend on field performance from the first 8 wells.

This has been previously flagged as taking around 12 months to assess.

What if anything has changed?

Most importantly the oil price has taken off.

Initial field performance is good, perhaps very good..

What was risky is now very profitable.

Why Bring Forward Additional Drilling

The oil price is predicted by many to come back to around $65.

Jaiowei wells (probably) have rapid decline (water coning).

PSC runs out in 2030.

In a nutshell, there is an opportunity to capitalise on current high oil prices to reduce risk..

Will Everyone Agree?

Based on my logic (possibly flawed) I think that HZN and ROC would agree,

CNOOC controls the rig, and needs to be onboard. I think that they would be because

1. 12-8-E has unlocked numerous similar fields fro CNOOC.
   CNOOC were keen for 12-8-E to proceed whereas the other JV partners were more cautious.
   This is reflected in the terms of the development. .
   I suspect that CNOOC would like to get additional information to assist in planning for these other opportunities.

2. The government has mandated that companies produce as much as possible.
   As a general principle, continuing drilling saves rig move time, and is likely to bring more oil onto production.
   This may be the reason that the infill and workover wells in the Block have been delayed.
   Makes sense to continue at 12-8-E.

What Are the Possibilities?

There are 2 that I have identified (there may be others)

1. If 12-8-E-A8 is duster (stacked sands and basement), and the Jaiowei is drilled and is successful.
   They may drill additional wells into the eastern flank Jaiowei reservoir.

2. If 12-8-E-A8 is successful (stacked sands and/or basement).
   This opens up additional similar plays that may be drilled..
   They may even consider drilling some of these even if A8 is a duster.

They have had a lot of time to analyse the structures in the Block, hence many could e drill ready.

The A8 well gives them useful information (similar structures and the Eastern Flank of the Jaiowei sand).

Will They Do It?.

I have no idea.

It makes sense to me, so hopefully the answer is yes.