Despite a limited budget to carry out its exploratory activity, Ecopetrol and its partners have made progress that allows the oil industry to maintain its vitality. The offshore perspective gives us to think that the coming years will be moved in terms of production.
Max Torres | Vice President of Exploration of Ecopetrol
In dialogue with Colombia Energía, Max Torres, the Vice President of Exploration of Ecopetrol, gave us his opinion about the hydrocarbon potential in the country. He also referred to the most outstanding findings of the company and the companies with which he works, both in Colombia and abroad.
Could you tell us in general terms about the advances in Ecopetrol exploration?
With respect to exploration, I could tell you that we have the objective of incorporating at least one billion barrels of contingent resources by 2020, together with the incorporation of six hundred million barrels of proven reserves from both current and exploration fields. To achieve this, we are concentrating our efforts on high-value projects offshore in Colombia, on the revaluation of opportunities in mainland Colombia and the consolidation of international areas such as the Gulf of Mexico, Brazil and other areas of America. The results are already happening. In recent months, we have had four consecutive successes: Warrior in the Gulf of Mexico (United States), operated by Anadarko (65%); Ecopetrol (20%) and MCX Exploration (15%); Bullerengue Sur-1 (Colombian Caribbean), a success of Hocol, a subsidiary of the Ecopetrol group, where its partner is Lewis Energy (50%); Purple Angel-1 (successful delimitation of the Kronos well) in deep waters of the Colombian Caribbean where Anadarko has a 50% participation; and, finally, the recent discovery in the department of Santander, the Boranda-1 well, where Parex has a 50% stake.
It is important to note that despite having a limited budget of US $ 256 million in the previous year, when a company of the size of Ecopetrol must have a budget for exploration of the order of US $ 600 to US $ 700 million, in 2016 we increased the value 45% of the portfolio, and we achieved a 43% success rate. This is an average higher than most companies worldwide, as we had three successes (León App, Warrior and Bullerengue), of the seven wells explored.
In the sector there is optimism for the prospect of offshore prospecting, how is this segment so important for the company and the country?
Without a doubt, we have a promising future in the offshore segment, in fact, Ecopetrol’s budget for exploration in 2017 is US $ 652 million, of which US $ 295 is for offshore and US $ 357 will be invested in the onshore. This year, we are undertaking an intense exploratory activity directly and with partners. Of the 17 wells that we will drill in 2017, in total six will be in the offshore (one in the Gulf of Mexico and five in the Colombian offshore), the other eleven will be in different regions of the country.
Particularly in the offshore segment, Colombia will invest a figure close to US $ 180 million, which we hope will contribute to maintaining the self-sufficiency of gas required in the next two decades. Our first exploratory success of the year was offshore with Purple Angel-1, a well that confirms the extension of the gas field discovered with Kronos-1 in July 2015. This discovery proved a gas column greater than 520 meters in this field . In this block, Ecopetrol has a 50% stake, while Anadarko, the operating company, has the other 50%. In addition, with Anadrako we are partners in the United States, where we recently announced a discovery at the Warrior well. Likewise, at this time the Bolette Dolphin ship, the latest technology drilling equipment, is advancing in the drilling of the Gorgon-1 well, an additional prospect, located in the same Kronos trend. We hope very soon to be sharing the results of this exploration.
In parallel, the Siluro wells (Ecopetrol 50% – Repsol 50%) and Brahma will be drilled, which seek to validate the Orca discovery play in the Tayrona block (Petrobras 40%, Ecopetrol 30%, Repsol 20% and Statoil 10%). In the second semester the Molusco well (Ecopetrol 50% – ONGC 50%) will be held, where for the first time Ecopetrol assumes the role of offshore operator. Finally, we will advance over the Gulf of Mexico where we will drill the second Warrior well. The successes achieved so far confirm the potential of the Colombian Caribbean, one of the focus areas of the new exploratory strategy and key to increase our reserves.
What are the main challenges facing offshore exploration and production in Colombia?
The first is to advance with the exploratory campaign, which has as main objective to delimit the discoveries and test new prospects that help us determine with greater certainty the resources that lie in the main provinces, as well as productivity per well, two essential parameters for Determine the commerciality of the projects. Additionally, one of the most important challenges is to ensure that the country remains an attractive destination for investment and turn the sector into an engine that drives the national economy, hence the importance of advancing in a clear regulation that encourages offshore exploration. It is important to keep in mind that deepwater developments require high investments; they can be ten times more expensive in terms of Capex, than onshore, which is why it is necessary to take measures to guarantee demand and justify the money to be invested. Ecopetrol works together with other companies and with the national government to agree on the necessary vehicles that allow the market to be incentivized, enable gas as an alternative, adjust the regulation and promote the competencies that companies require to attend the operation.
Why is the Molusco well so important? How is this project progressing?
This project has been accepted as PINE (Strategic National Interest Project), which demonstrates its importance to our nation. Molusco-1 is a well in shallow waters (close to 60 meters deep), near Chuchupa and Ballena, gas fields located in La Guajira, which would facilitate the incorporation of this gas into the national market. It is the first time that Ecopetrol assumes the role of offshore operator, for this, it has formed a team with high technical capabilities in Colombia, which has the support of professionals from Ecopetrol America Inc. in Houston (USA). To strengthen the offshore operation and take advantage of the tax benefits offered by the Government, the subsidiary of Ecopetrol Costa Afuera has been formed, which will initially focus on operating block RC9, where the Molusco-1 well will be drilled. Molusco-1 is located near Riohacha, 30 kilometers in a straight line to the beach, about 12 kilometers from the Chuchupa B platform. We will have as a partner the NGO ONGC of India, with a 50% participation. We will be starting drilling the first week of September 2017.
Again, referring to the offshore segment, what is the current status of the Purple Angel block that they have budgeted to exploit with Anadarko?
As I mentioned earlier, the presence of gas in the deep waters of the Colombian Caribbean was verified in the Purple Angel-1 well, 4.7 kilometers from the discovery announced in July 2015 with the Kronos-1 well. The Purple Angel-1 well reached a total depth of 4,795 meters, including a 1,835 meter water sheet, and recorded intervals with the presence of gas (“pay”), whose total sum is estimated between 21 and 34 meters thick (between 70 and 110 feet). The two wells confirm the potential of this hydrocarbon province in the southern Colombian Caribbean. Based on the information acquired so far, it is estimated that the Kronos field has a gas column of at least 520 meters. Ecopetrol has a 50% stake in this block; Anadarko, operating company, has the other 50%. The Purple Angel block is in the second phase of exploration, which includes the drilling of two exploratory wells, Purple Angel-1 and Gorgon-1, which are intended to be completed within two months. If this project is positive, it would be incorporated into the program of delimitation in the block in order to study the possibility of making a joint development of the two fields.
What other findings and future projects would you highlight, and consider allowing Ecopetrol to meet its exploration objectives?
On the onshore we recently announced the results of the Boranda-1 well. This well is located in the Middle Valley of Magdalena, in the Municipality of Rionegro, department of Santander. Boranda-1 is operated by Parex, which has a 50% stake, while Ecopetrol is a 50% partner. This finding borders to the southwest with the Aullador and Cristalina fields, and to the northeast with the Pavas-Cachira field, managed by Ecopetrol. The finding was 3.6 kilometers deep, where an area with the presence of oil sandstones with a total thickness of 40 meters was detected. This alliance is part of our dilution strategy where we partner with companies with experience and operational efficiency such as Parex, taking advantage of the opportunities presented by mature watersheds, which allows us to move forward in our objective of increasing reserves, leveraging on existing infrastructure . In the offshore, in addition to the projects mentioned in the Colombian Caribbean, we will advance our exploration campaign in the Gulf of Mexico with our partner Anadarko and drill the second Warrior well.