Project Profile
Value: Undisclosed
Location: western Turkmenistan
Production: 2 BCM/year (200 MMscf/day)
Area: 1,050 km (Nebit Dag PSA)
Start-up Year: 2016
Burren Energy signed a PSA with the government of Turkmenistan in August 1996 to develop Burun, the largest set of fields in the onshore Nebit Dag area. In 1995 Burren formed an alliance with Monument Oil & Gas Plc to acquire upstream projects in Turkmenistan which led to the signature of the Nebit Dag PSA in August 1996. Mobil joined the consortium later that year. The consortium of Monument (as operator), Mobil and Burren initiated a rehabilitation and development programme on the Burun field, the western-most field in the Nebit Dag PSA area, which led to the commencement of oil exports in May 1998. Following the takeover of Monument in June 1999 and the merger of Mobil and Exxon in December 1999, the consortium partners decided that Nebit Dag was not of strategic importance to their businesses and Burren acquired their interests, becoming operator with a 100 per cent working interest in August 2000. On taking over operational control Burren cut on-site overheads and administrative and head office costs and terminated most sub-contracting agreements, bringing these services in house. These reductions in operating costs led to operations rapidly becoming cash-flow positive.
Oil has been produced from fields within the Nebit Dag PSA area since the 1940s. The Burun field, which was producing oil at the time the PSA was signed and from which Burren presently derives the whole of its Turkmenistan production, was brought into production in the 1970s but was still under development. In November 2007, ENI agreed to buy Burren Energy, an oil and exploration production company based in the UK, for 1.73 billion pounds (US$3.6 billion). With this purchase, ENI became the sole stakeholder and operator of the Nebit Dag block. The Nebit Dag PSA area (1,050 km) is located onshore in western Turkmenistan and contains five developed oil and gas fields. Burren has production rights to the Burun field, at the western end of the area, as operator with a 100 percent working interest. The other four fields within the PSA area (Kyzl Kum, Kum Dag, Kara Tepe and Nebit Dag) are operated by the state oil company Turkmenneft. Burren has exploration rights over the rest of PSA area under an exploration license which expires in February 2007. The PSA term runs until 2022, and may be extended for a further 10 years by mutual agreement with the Turkmenistan government. Burren has been the operator of the PSA since 2000. At the end of 2005, the Burun field was producing approximately 19,000 boepd (barrels of oil equivalent per day) from 135 wells. Development to date has been primarily on the north flank of the field whilst the south flank remains to be appraised. Prior to 2004, well activity consisted of workovers to return shut-in wells to production. Development drilling commenced in 2004. Average working interest production during 2005 increased by 35 percent to 15,410 boepd (2004: 11,430 boepd). Gas-lift is now installed on most of the Burun field wells. Oil separation, treatment and storage facilities were upgraded during 2005. A pilot water injection scheme was implemented during 2006.
When its PSA was signed in 1995, the planned investment was put at US$500m. All oil produced over that volume was divided between Turkmenneft and Burren Energy. The Nebit Dag PSA includes deep reservoirs beneath the Nebit Dag and Kum Dag fields, whose shallow formation had been virtually worked out. Nebit Dag went on stream in late 1997 and now is producing 30-36[degrees] API oil. Originally the output of this and other fields was planned to reach more than 50,000 b/d before end-2000. But the fields are producing far less than that at present. It was agreed in 1995 that these oilfields’ peak production after rehabilitation should reach 180,000 b/d by 2006. Independent experts have said such a target was too ambitious and may not be reached before 2010/12. The PSA gives the partners rights to a condensate field of Kyzl Kum and the Kara Tepe gas field. It has been said Nebit Dag contains about 2 bn barrels, with a recovery factor of 25-35 percent. In August of 2007, Burren Energy had record results from an appraisal oil well in the Burun field in Turkmenistan. The Burun B0-63 well logged 60 metres of virgin net pay in the south-west of the field. The above results have contributed to production in Burren’s fields in Turkmenistan reaching a record 23,400 barrels of oil per day during the first half of August. This compares to average production of 21,800 bopd during the first half of the year.
Burun Field
In October 2009, ENI signed a Memorandum of Understanding with the government of Turkmenistan to further increase production in the area. In 2009, ENI produced 12,000 barrels/day in Turkmenistan. The Burun Field produces up to 2 BCM/year (200 MMscf/day) from existing wells and with the drilling of 45 new gas wells in undeveloped gas bearing areas of the field. Gas reserves and production profiles for the Burun Field were initially confirmed by an independent audit carried out by Ryder Scott Company in July 2006 and updated in December 2007.
Phase 2
ENI has launched the Phase of the Burun Field Development. The company is performing FEED studies for the facilities related to the phase 2 of the project, including:
- Network collection and pretreatment in field
- New treatment plant and upgarding existent
- System of export oil product
The future plan to obtain the Estimated CAPEX, prepare the documentation for the technical races for the EPC contract and purchase LLI, as well as obtain support during the stage of technical evaluation. Burun Field SPP Facility is the plant in Turkmenistan also managed by ENI Spa. The plant is based in the western part of the country near Caspian sea and is subjected to revamping for increase the oil and gas production. In 2011, DG IMPIANTI INDUSTRIALI S.p.A. was awarded a contract with scope of work including the survey of the existing plant to obtain complete cloud of the plant (189 scans), spherical navigation using Leica Truview (black/white and Camera color) and to acquire GPS coordinates (used Magellan Mobile Mapper CX). In 2011, Enereco was awarded two projects, namely Gathering Network Upgrading &Oil Export Pipeline. The company is carrying out the Feasibility Studies for these two projects to establish the viability of upgrading the Burun field installations to increase oil production. The contract was awarded by Tecnomare SpA, a subsidiary of ENI who is responsible for the whole FEED stage of Burun phase II development. During 2011-2012, the company performed SPP and Gathering Network revamping, designing the export terminal as well. Phase 2 is focusing on the construction of new facilities including: Oil/gas Separation, Gas Lift and Water Injection gathering, field desanding stations, oil export pipeline, oil storage tank farm and jetty on Caspian Sea.
In November, Eni SPA signed an addendum to the production-sharing agreement (PSA) it has with Turkmenistan with respect to the onshore Nebit Dag block in western Turkmenistan. The addendum extends to February 2032 the duration of the PSA for the block and transfers a 10% stake of Eni’s contractor share to Turkmenneft. Eni, which serves as block operator, will keep the remaining 90% interest stake in the PSA. The agreement focuses on the efforts of Eni to enable further exploration and production investments in Burun and other satellite fields of the Nebit Dag block.
Operators:
ENI: Operator with 90% interest
Turkmenneft: 10% interest
Contractors:
Ryder Scott Company: Independent audit of the Burun geological reserves
DG IMPIANTI INDUSTRIALI S.p.A. was awarded a contract with scope of work including the survey of the existing plant to obtain complete cloud of the plant (189 scans), spherical navigation using Leica Truview (black/white and Camera color) and to acquire GPS coordinates (used Magellan Mobile Mapper CX).
Tecnomare SpA: A subsidiary of ENI responsible for the whole FEED stage of Burun phase II development.
Sub-contractors:
Enereco: Feasibility Studies for the Gathering Network Upgrading &Oil Export Pipeline to establish the viability of upgrading the Burun field installations to increase oil production. The contract was awarded by Tecnomare SpA.