Today operator Woodside Petroleum released figures showing the $US700 million ($A930 million) field averaged just 23,390bopd for the 2006 December quarter, which it attributed to natural field decline.
“I think right now at Chinguetti, good news would be a surprise, whereas bad news is not,” Doran, whose company is a minority stakeholder, told PetroleumNews.net following the release of Woodside’s figures.
“The big surprise was when we brought the field online in February and it failed to live up to expectations – since then we’ve taken our medicine.”
While the project has now been put into the “sick puppy basket”, Doran said there were still valuable lessons to be learnt, such as the danger of making premature output and reserve forecasts.
“The main lesson is avoiding pre-production forecasts where you can because you run the risk of disappointing and misleading people,” he said.
“It’s difficult to do when you’ve got investors on your back, but if you consider Cliff Head [in the Perth Basin], we never forecast what production would be – at best we said we expected it to come online above 10,000bopd, and it did.”
Woodside was unavailable for comment.
Saving Chinguetti
But the joint venture is not giving up on the troubled project just yet. Last month, Woodside started a $100 million-plus drilling campaign with the spudding of the Chinguetti-18 development well.
Under the original plan to combat the poor production rates, four infill wells were to be drilled over the next 18 months, with each well expected to increase output by about 10,000bopd.
But several months ago, the drilling program was revised to allow Woodside to acquire additional 3D seismic data following the completion of the first well to allow more detailed planning.
Roc has previously advised that Chinguetti-18, which is being drilled with the Atwood Hunter rig, is expected to reach total depth by the end of next month.
Chinguetti started pumping more than 70,000bopd when it came onstream in late February 2006. Output then declined steadily before stabilising around 31,000bopd in the 2006 September quarter.
The partners now expect production to average just 20,000-30,000bopd this year.
Problems at Chinguetti – Woodside’s highest margin oil venture – was a main reason the company was, for a second time, forced to downgrade its production forecasts for 2006 and 2007.
Having already slashed its 2006 target by 5% to 72 million barrels of oil equivalent (MMboe) in June, Woodside reduced its forecast a further 7% in November to 67-68MMboe.
The latest downgrade was in line with Woodside’s actual 2006 production results of 67.9MMboe – up 13.8% from 2005.
Woodside has a 47.3% stake in Chinguetti, while Hardman, now owned by London-listed Tullow Oil, owns 19% and Roc has 3.2%. The remainder is shared between the Mauritanian Government and UK companies BG and Premier Oil.
