Santos, which operates the Bayu-Undan field offshore East Timor, said today that production from its Phase 3C infill drilling program has started with the first well producing a better than expected outcome.
The first well has been brought online at 178 million standard cubic feet per day (mmscfd) of gas and 11,350 barrels per day (bbl/d) of liquids, significantly increasing liquids production to over 25,000 bbl/d from the field and increasing offshore well capacity for supply of gas to the Darwin LNG plant, reported Santos.
The Noble Tom Prosser jack-up rig has now started drilling the second of the three wells, with the program expected to be completed early next year off the Southeast Asian nation, also known as Timor Leste.
Production from Bayu-Undan was initially expected to stop in 2022 without new investment. However, the infill drilling investment by Santos, which became the operator of the field in May 2020, after buying out ConocoPhillips, signals there could be more scope left to extend the life of the asset.
Analysis from Wood Mackenzie estimates the three wells should add around three years of production. This would keep gas supplies flowing to the Darwin LNG plant until 2024/2025. The Santos-led Barossa project, which received investment approval earlier this year, is expected to start up around 2025/2026 and help backfill the Darwin LNG export facility when Bayu-Undan finally stops producing.
“We’ve seen a better than expected reservoir outcome with this first well of the campaign, with successful results across both the primary and secondary targets in the well and a much higher initial gas production rate than expected,” said Santos chief executive Kevin Gallagher.
ANPM President Florentino Soares Ferreira said, “from the outset, the Phase 3C program has been seen as an opportunity to maximise the ultimate recovery in the Bayu-Undan field. This was of course a calculated decision from the regulatory side considering we are working under the Production Sharing Agreement regime in which the cost recovery scheme is a fundamental element in our assessment.”
“The successful result of the first 3C well has proven to us that our decision for approval was correct. We can now give additional hope to Timor-Leste with the increase of production and extension of the Bayu-Undan field life, and we look forward to the success of the two remaining 3C wells,” he added.
Santos has a 43.4% operated interest in Bayu-Undan. The remaining interest is held by SK E&S (25%), INPEX (11.4%), Eni (11%), JERA (6.1%), and Tokyo Gas (3.1%).