Interview: Tim Bushell, in charge of operations in the Falklands from Lasmo
Falkland Island News Network: Lasmo Begin Drilling
From: J. Brock
Date: 08 Jun 1998
(A Report for FIBS by Hermina Campbell 02 June 1998)
The Borgny Dolphin has been moving to Tranche "C" and on Tuesday was positioning itself ready for Lasmo to begin drilling their first well in the North Falklands Basin. Although minor, the trace of oil found by Amerada Hess, it was still unexpected and sooner than expected. In charge of operations in the Falklands from Lasmo is Tim Bushell. Speaking to him in London on Monday, I asked what Lasmo's reactions were to Amerada Hess's find and how it effected tham.
Tim Bushell: First of all the fact that they had some oil shows is encouraging. Quite a lot has been printed in the press about that. It is encouraging because, as Lasmo saw it, there may not be an oil source rock there and the fact that there are some oil shows there does indicate that somewhere in the region there is an oil source rock working but, on the other hand, we have to be extremely cautious with that information because there is a lot more we have to do to establish whether there is any kind of commercial oil there and I think perhaps people got a little bit excited over the last few weeks because they didn't understand that link and really the big difference between just having oil shows and having oil that can be produced in commercial quantities. In fact, the results from Amerada were encouraging and, in a way, helped us choose where we are going to drill.
Hermina Campbell: How then does that information help you decide where you will drill? In laymans terms, how is it giving you a better indication of where to put the oil rig?
TB Because in drilling in the Falklands we had no well data at all, we had to make assumptions and guesses, if you like, about what we could see on the seismic there. We always knew there would be some surprises about exactly the details of the geology and obviously the Amerada well has given us some understanding. I am sure there's a lot more that we will find out and there will be more surprises but it has given us some information about what level we may expect to find actual reservoirs which would hold the oil. and that's probably one of the key things that has come out of their well is information about that and the fact that there are oil shows and there is an oil source rock working, so that, in a way, guided us to where we are going to drill.
Obviously it's created a number of options as well, where we coudl drill in the future but, at the moment, it did help in selecting this well. It's hard to explain it in any more detail than that, really.
HC Are there any disadvantages in being the first or second company to drill?
TB There are always disadvantages in drilling early on. The more information you get the better. By the time the fourth company comes to drill, which I think it IPC, they are going to benefit quite a lot from knowing the data and information that have come out of the first three wells. Someone had to go first and during the negotiations when we first created the FOSA group, we came up with an order and that's just how it is, really.
HC Amerada Hess completed their drill before they expected. Are you able to indicate whether it's likely to be quicker than expected? How much time is it going to take for this next well do you think?
TB It is very difficult before you have drilled a well to tell just exactly how long it's going to take to complete the well and I think we were all conservative when we were talking about the amount of days it would take. Amerada did it quite a bit quicker. I suspect that we will do the same thing but there are always problems or uncertain conditions that you can run into but we would hopely complete operations within a month or so.
HC Finally,, then, Desire, obviously in comparason to Amerada Hess is very small and their shares have been affected quite a lot. Havbe shares within Lasmo been affected by this find and the fact that the well has been abandoned?
TB Not really. I think our share price moved up a little bit during the time when Desire's share price was going up the most but it is only the fact that the whole of Desire's investment is directly related to the Falklands therefore any success down there reflects into their share price whereas Lasmo, an International oil company have interests all over the world and really, success in the Falklands while exciting for Lasmo's share holders would, in fact, realise it was early days. I think that probably one of the issues was there was quite a lot of speculation about what was happening there and what the implications were of those oil shows and I think people got too excited about those results. While they were encouraging, I think they were slightly mis-understood. Obviously Lasmo has a different set of shareholders.
HC so, general advice to everybody is sit tight and wait and see.
TB Yes. It could take six or seven wells before something is proven. The geology of the area may well be more complicated than what people thought and we are not able to predict with the seismic exactly what is under the earth and you need to drill wells and that really is the fundamental part of the oil exploration business. We will see ups and downs along the way regarding news coming out of the various wells that are being drilled down there.
sartma.com |
