US independent Apache Corporation has gone from strength to strength since acquiring Repsols Egyptian assets in 2001.
Gas production has since soared 124% while oil and condensate output has risen by 61%, making the company the third largest producer after Italy's Eni and Britains BG Group.
"Egypt has been good for us and we have been good for Egypt,"says Apache general manager Rodney Eichler.
The company is now producing 195,000 barrels of oil equivalent per day with the lions share coming from the Khalda concessions in the Western Desert.
It is on track for a significant boost in gas production over the next two years by building new processing facilities. The focus is on the key Qasr field.
The expansion will lift company output from 510 million cubic feet a day now to 710 MMcfd by January 2009.
"In Qasr, we have 18 to 20 development wells to be drilled to be able to maximise production and we have 24 months to complete that work,"Eichler tells Upstream. The hectic development phase will provide gas feedstock to trains 3 and 4 of the Salam Gas Plant.
"We will be in a position to have both facilities complete by 1 January 2009,"he says."Right now, we are producing 510 MMcfd so we are going to build two 100 MMcgfd sales gas trains. Almost all that gas will come from the Qasr field."
UK-listed Petrofac is building the third and fourth trains of the Salam plant, which will also process 14,000 barrels of condensate a day each.
Gas exploration is progressing hand in hand in the area."We will continue to drill for gas. We have a very large inventory of gas prospects to be drilled,"Eichler says. The Qasr field, Apaches largest discovery, is now producing 340 MMcfd of gas and 15,800 bpd of condensate from the Lower Safa sands.
Discovered in 2003, Qasr has proven reserves of 2.1 Tcf of gas and 64.5 million barrels of condensate. The field is also producing 8000 bpd of oil from the shallower Cretaceous Alem el Bueib (AEB) formation. Development drilling is underway to boost crude output.
While Apaches gas flows are currently constrained by a lack of processing facilities, it is working hard to lift both crude output and maintain production from older fields through secondary recovery techniques.
It is pumping a total of 98,000 bpd of crude oil and around 18,000 bpd of condensate from the Western Desert but is determined to grow its oil and condensate output by between 5% and 10% a year in the long run.
Eichler believes that Apache can increase output from the current levels over the next two decades. Its concessions run out by 2029.
Most of the short-term output hikes will come from Khalda with the remainder coming from the Qarun fields lying in the eastern part of the Western Desert.
"Apache is a growth company,"Eichler says."We aim to achieve growth in production every year. We are the only company in Egypt able to do that.
"We have managed to replace our production and grow every year, and managed to offset production associated with natural decline and grow."
The company is implementing a number of secondary recovery projects in the Khalda area to spur growth and offset declines from the mature fields. These include waterflood projects in some of the largest fields.
"We are still in very early stages. After a couple of years we expect the production growth will be very significant,"Eichler says.
The Qarun concession, which is pumping 31,000 bpd of oil, will also witness increased spending in 2007 to lift output. Qarun saw hectic activity in 2005 as part of the development of the Yomna, Asala Ridge and El Diyur-North oilfield discoveries.
The Yomna field, which started water injection in late 2006, is producing 3200 bpd. Output from Asala Ridge has risen to 5600 bpd with the commencement of a water injection programme in December. El Diyur-North is producing 2900 bpd. Apache acquired a record 6332 square kilometres of 3D seismic data last year, setting the stage for exploration drilling on a number of prospects in the Western Desert concessions.
"Apaches Egypt region has ample opportunity and is well positioned to increase production via aggressive exploration and development drilling in 2007,"Eichler says.
A total of 268 wells are planned this year, including 33 new field wildcats, compared with 156 wells drilled in 2006.
Apache has enjoyed a string of exploration successes in recent years, enabling it to add to its oil and gas reserves. It made a discovery in January with its Alexandrite 1X well that found gas and condensate in the Alam El Bueib 6 formation in the Matruh block.
More exploration success followed in February with the Syrah 5X appraisal well that test flowed 47.6 MMcfd of gas from the Lower Safa sands, thus extending the Syrah field lying north of Qasr.
Judging by its past record, Apache is in for further exploration joy."To date, we have drilled over 850 wells in Egypt. In that time we have had a 50% success rate on our exploration wells and over a 90% success rate on development wells.
"Being an aggressive driller is ever part of Apaches business culture,"Eichler adds.
© Upstream 2007
