|
3:12 GMT, Jan 15, 2007 INTERVIEW: Canada's Falcon Oil and Gas confident of viability of giant Hungarian gas resource By Balazs Szladek BUDAPEST. JANUARY 15. INTERFAX CENTRAL EUROPE - Canadian exploration firm Falcon Oil and Gas believes that natural gas resources in its Mako concession area in Southern Hungary, estimated to hold enough gas to possibly meet Hungary's consumption needs for decades, are economically recoverable despite the "unconventional" nature of the field, Falcon Oil and Gas Chairman and CEO Marc A. Bruner told Interfax in an interview. "I'm confident that it's going to be economical, it's my gut reaction from having done it successfully before with some other companies," Bruner said. "The chances that the aggregate total gas would not be enough to work [with] is not probable in my view. If the technology works as we think it's going to work, [the field could] provide significant flows of gas, more than anything you've seen before in Hungary." Falcon Oil and Gas has been exploring the Mako field since late 2005. Late last year, independent industry auditors the Scotia Group issued a resource estimate on Falcon's Hungarian fields, reporting a 90% probability that gas resources could reach 21.8 trln cubic feet, or more than 600 bln cubic meters, equivalent to more than 40 years of Hungary's entire domestic gas consumption. According to the report, whose findings were accepted by Hungarian mining authorities in late December, there also exists a 10% probability that gas resources in the Mako Trough - measuring 80 kilometers in length and 35 kilometers in width - could total as much as 116.1 trln cubic feet, and a 50% probability that resources could reach 54.9 trln cubic feet, or more than 1,500 bln cubic meters. "Those are very large figures, and they're saying that the most likely case is the 54 trln [cubic feet]," Bruner said of the findings of the report. "That's the most likely case, and certainly that would make it a giant gas field." Environmental impact studies of the field are currently underway, while test production, which the company hopes will confirm the economic viability of drilling, is expected to start in 60-90 days, said Bruner. These upbeat estimates have raised hopes that Hungary, now importing 80% of its gas, could even become a net exporter of natural gas (see separate story). However, public enthusiasm over the size of the project has been cooled by the difficult geological characteristics of the field and subsequent concerns whether these resources can ever be classified as proven reserves and extracted economically. The Mako gas deposits are "unconventional" deposits, for the most part lying at least twice as deep as conventional deposits. A recent test drilling took Falcon to more than 6,000 meters, the largest depth ever reached in Hungary. These depths involve higher pressures and temperatures, and drilling operations take exponentially longer - the first 3,000 meters of a well can be drilled in 30-45 days, but drilling down another 3,000 meters can take at least four months. Rocks at this depth also have lower porosity and permeability levels, which indicate the amount and accessibility of hydrocarbon particles in pieces of rock. While admitting these challenges, Bruner stressed that such "unconventional" fields are becoming increasingly conventional, thanks to the depletion of older fields but also to new technologies that have sprung up over the past decade. "Before 1995-96, nobody heard of unconventional gas in the U.S., but today it represents 25% of our production," the CEO said. "According to the US Geological Survey, 60% of all the reserves that are left in the onshore U.S. are unconventional gas reserves. Some 70% of all our rigs are drilling for unconventional gas reserves. "So this is not some untried, untested technology, this is a technology that's been perfected since the mid-1990s," he added. Bruner noted that Falcon's Pinedale, Wyoming, field in the U.S., a similar "unconventional" deposit that is now the biggest gas field on the US West Coast, was discovered in 1949 and most of its rigs drilled in the 1970s, but it could not be turned economical until 1998, when new technologies helped increase production rates more than tenfold. Similarly, the Mako Trough deposits were already discovered in the 1960s and 1970s by the then stated-owned predecessor of oil/gas company MOL. However, despite taking three years to drill as deep as 5,800 meters, the company had to abandon its efforts, as it was unable to economically recover gas or even determine with any certainty whether it would be able to do so with the technology available at the time. "I recognize [the Mako field] to be something very similar to the deposits in the U.S., as rocks are rocks, no matter where they are," Bruner said. "MOL knew what they had found here; they just didn't have the technology to get it out, because it was not invented until 1997-1998 by [US firms] Halliburton and Schlumberger." With USD 300 mln earmarked for the project, Falcon has already drilled five wells in the area, and has also built a pipeline connection to MOL's nearby Algyo natural gas production facility, which in turn is connected to the nationwide gas network. While Bruner said it will take time to ramp up production at the Mako field, he noted that eventually this will have to be followed by further infrastructure developments. "The current system is fine for a while; however, we're going to need additional processing capacity [as well as] additional pipeline capacity," Bruner said. "But when you have a big gas supply, that's not going to be a big issue, and I'm very confident that we'll be able to find solutions to that," the CEO said, adding that Falcon has so far been "pleased" with the cooperation with MOL and the availability of qualified local personnel. The CEO added that drilling and operating test wells normally cost twice as much as exploitation wells, so initial costs of production should be no cause for discouragement. "Whatever the costs are, it's not appropriate to say that that's going to be the development cost, because that's totally wrong," according to Bruner. "We should be able to lower the cost by as much as 50% when we go into the exploitation phase." BS/JT/RV For further information please contact the reporter at email: balazs.szladek@interfax-news.hu or by telephone on: (+36) 1 269 7808 (Quelle: http://www.interfax.com/5/230888/news.aspx) |
|
| aus der Diskussion: | FALCON - ALLE DATEN, ALLE FAKTEN |
| Autor (Datum des Eintrages): | dontsushi (15.01.07 18:02:07) |
| Beitrag: | 18 von 47 (ID:26938777) |
| Alle Angaben ohne Gewähr © wallstreetONLINE | |