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DW Monday: Nowhere Fast

By November 28, 2016September 7th, 2022No Comments

DW Monday

Myanmar, once impeded by political and economic trade embargoes, has seen a dramatic turnaround in fortunes since the lifting of international sanctions in 2012. A number of Western E&P players such as Shell, ENI and Chevron, as well as Independents including Reliance Industries and Oil India amongst others, have been drawn to the country’s gas potential, most notably in the deepwater Rakhine basin. Following the discovery of the Thalin-1 well in the AD7 block in Feb 2016, Woodside has shown significant commitment to exploring and developing acreage (up to 4-7 E&A wells). The Australian operator has recently contracted the Dhirubhai Deepwater KG2 (a deepwater drillship), scheduled for a year-long campaign in 2017.

Reserve Replacement Ratio by Company 2010-2015

Reserve Replacement Ratio by Company 2010-2015
Source: Company Reports

In June 2016, an Exxon-Hess alliance has upgraded the mid-point estimate for total reserves for its Liza field discovery offshore Guyana to 1.1 billion barrels. This may be further increased following the results of the Liza-3 well. The find represents the first commercial discovery in the country and is expected to be developed via an Early Production System in the first phase. The success of the Liza field has injected strong enthusiasm for exploration activities offshore neighboring Suriname, where Petronas has completed a (dry) well in 2016  and Apache has commenced seismic acquisition on block 58 and is to drill a well in Q1 2017. Compared to the tepid reaction in 2015, the current round of acreage offered by Staatsolie, a state-owned oil company, has garnered widespread interest amongst the international E&P community.

Stand-alone deepwater developments are difficult in the current market. We note that all of the sanctioned deepwater projects in 2016 are subsea tie-backs. However, it is evident that as the market recovers there are substantial reserves that can be brought into development as oil prices allow.

Chen Wei, Douglas-Westwood Singapore
+65 6635 2000 or [email protected]