Rosneft (ROSN.MM) — Brownfield Briefing – Production
Stabilisation, Cost Control
19 November 2013 ¦ 8 pages ir.citi.com
Rosneft held a briefing for analysts on its brownfield production plans. The main
takeaways were: a) Overall oil production is projected to grow at c1%pa through
2017 before accelerating; b) production at key brownfield assets Samotlor and
YuganskNG to be stabilized; c) CAPEX per produced barrel in 2013 looking
encouraging to us; d) testing in shale on-going, results to be summarized next
February; and e) unconventional production to grow to 200kbd by 2020.
Ronald Paul Smith | Alexander Bespalov, CFA
excerpts:
...via horizontal wells, multi-stage fracturing, other technologies – Rosneft will
achieve brownfield stabilisation by ramping up usage of horizontal wells with multi-
stage fracs, more sidetrack wells, better water floor management, and dual well
completions and injections. Per company data, horizontal wells with multi-stage
fracs in YuganskNG have average initial production rates of 157tpd (1,150kbd), well
above the 60tpd (440kbd) the company reported last year as the rate for the typical
vertical well. Samotlor horizontal wells – better than half of such wells currently
being drilled by Rosneft due to TNK-BP having earlier started development of the
Ryabchik formation – are averaging 37tpd (270bpd)...
...Unconventional oil production to climb – In 2013 Rosneft will produce about
500ktons (10kbd) of hard-to-produce reserves, per management, but those levels
are forecast to climb to 1.6m tonnes (32kbd) in 2014, to 4.4mt (88kbd) in 2017, and
7.4mt (150kbd) in 2020. By 2017 management expects a bit over 200kbd of
Samotlor production to be coming from horizontal wells of all types vs. 20kbd today.
At YuganskNG by 2017 tight oil production (Bazhenov etc, and not necessarily
comparable with the Samotlor number above) should reach 32kbd from negligible
levels today.
Results of shale test projects to be summarized in February of 2014 –
Production from the Tyumen suite (shale) at the Em-Egovskaya pilot project
(Halliburton) should ramp up from 14kbd in 2014 to 36kbd in 2017 and peak at
65kbd in 2022 or so. The Severo-Kokhryakovskoye pilot project (Schlumberger) is a
bit more modest, but production from low-permeability reservoirs there should ramp
up from 4kbd in 2014 to 32kbd in 2025 or so. Both projects are using test wells to
experiment with drilling and completion techniques, so the current focus isn’t
production so much as optimisation. Management indicated that it will sum up pilot
project results to-date in February of next year.
Ramp-up of horizontal + multi-stage fracturing may cause temporary OFS
shortages in 2014, but unlikely to persist – Management opined that the rapid
increase in horizontal drilling with multi-stage fracturing in Russia may give rise to
tightness in the oilfield services market for certain categories of equipment, in
particular for coil-tube and sidetrack drilling rigs. However, management felt that
these issues would likely be addressed by the OFS industry by 2015, and are
manageable in any event. Frac fleet availability might also be a bit tight, but
additional equipment and crews are already being mustered and therefore
shortages are less likely to be encountered in that area...
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That's what Russian state-owned, Rosneft told analysts. Meanwhile Russian state-run
media is telling their European friends (customers)...
Shale gas production: an ecological threat to Europe
voiceofrussia.com
The introduction of US technology to produce shale gas may result in an ecological disaster in Europe, claim ecological organizations. Washington has been actively advancing its own shale gas production technology throughout the world to prop up US companies...
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The Voice of Russia must assume that their listeners don't follow business news and won't realize Russia
fracks while Europe delays. They seem to be right in that assumption. |
