26 July 2021 - 13:47
  • News Code: 318992
Investment Opportunities in Bangestan

TEHRAN (Shana) -- More than 60% of Iran’s oil production comes from 10 giant fields, all of which having reached maturity. Lack of investment for many years in order to enhance the rate of recovery has enhanced production risk. However, there is great potential for enhanced production from these fields. A case in point pertains to the Ab Teimour and Ahvaz Bangestan oil fields. They were discovered more than 50 years ago and they are still supplying oil.

Ab Teimour in Khuzestan province is located 25 kilometers west of Ahvaz. It is between Mansouri and Susangerd oil fields. Ab Teimour was discovered in 1961 following seismic test. A first well was drilled there six years later to prove the existence of oil. However, production from Ab Teimour began in 1991. Ab Teimour measures 23 kilometers in length and 6 kilometers in width. According to primary calculations made, it is estimated to hold at least 15.2 billion barrels of oil in place.

Bangestan's current production stands at 60,000 b/d from 50 wells (29 wells in Ilam formation and 21 wells in Sarvak formation).

Ab Teimour is administered by National Iranian South Oil Company (NISOC), but its production operations are handled by Karoun Oil and Gas Production Company.

In the 130th meeting of the committee of reservoir consultants of National Iranian Oil Company (NIOC), the general plan for the development of Bangestan was discussed in three phases – natural depletion, artificial lifting and water and gas injection.

Given uncertainty of some data and in the light of completing reservoir data, development of Ab Teimour was designed in pre-phase and full-phase stages.

In the pre-phase stage, required data is gathered and pilot tests are conducted so that the development project would be updated and finalized. Based on the existing information, the pre-phase flow is forecast at 55,000 b/d and the full-phase flow at 110,000 b/d.

Over recent years, many foreign companies have expressed readiness to develop the field, but due to international sanctions, agreements were terminated. Following the removal of sanctions, several companies including Russia's Lukoil agreed to submit the results of preliminary studies on the field to NIOC in the near future. However, foreign firms had to quit after the United States' unilateral withdrawal from the Iran nuclear deal and re-imposing sanctions on Iran.

Iran's Petroleum Ministry has given the Ab Teimour data to several companies in order to examine various scenarios by rivals. Each company has submitted a separate proposal to NIOC. Indonesia's Pertamina has suggested 250,000 b/d production and Lukoil 150,000 b/d. Denmark's Maersk plans different scenarios including 200,000 b/d, 300,000 b/d and 450,000 b/d production. Maersk's 450,000 b/d plateau could remain for four decades and the company must operate the field for a longer period of time.

Such output would be reached in case the recovery rate of Ab Teimour is enhanced from the current 2.27% to 12%.

Technical studies by Iranian experts show that the field's output could be increased up to 95,000 b/d. Ab Teimour is estimated to contain 15 billion barrels of oil in place and so far 315 million barrels has been recovered from the Bangestan reservoir. Near this reservoir is erected a production unit with the rated capacity of 55,000 b/d, a desalination unit with the capacity of 55,000 b/d and a gas pressure booster unit with the nominal capacity of 20 mcf/d.

NIOC experts and specialists have processed and interpreted 3D seismic test data and identified a new reservoir structure which contains around 2 billion barrels of oil in place.

As the Bangestan reservoir, pressure and the wells' stream pressure change, artificial lifting of Ab Teimour in the Bangestan reservoir was planned. The project is now in its final stages and the flow of oil wells from Ab Teimour will be stabilized after artificial lifting system is installed.

9th Largest Oil Reservoir

Iran sits atop 10% of world oil reserves, i.e. the fourth largest crude oil reserves in the world. However, due to a variety of reasons, including lack of cutting edge technology, Iran has tapped less than 20% of its recoverable reserves.  

Furthermore, over the past four decades, recovery from Iranian oil reservoirs has been done with natural pressure and today downhole pumps are used for recovering oil.

Bangestan oil reservoir in the oil-rich city of Ahvaz in southwest Iran is a case in point. Currently, 26 downhole pumps are operating in this reservoir.

Bangestan oil field, which is considered to be the 9th largest reservoir in the world, is producing at a 10% recovery rate. Of 37 billion barrels of oil in place in the reservoir, only 1.2 billion barrels has been recovered. Given the 10% recovery rate, around 4 billion barrels could be still recovered.

Development of Bangestan oil field was assigned to Petroiran Development Company (PEDCO) in early 2005, but one year later the company announced it was not ready to develop the field. Then negotiations were started with Pars Tat Company, held by "Iran’s Mostazafan Foundation" and Russia’s Tatneft. The talks failed and the project was finally awarded to National Iranian South Oil Company (NISOC). Given the completion of comprehensive studies for this field, the most important action that must be taken seems to be enhancing recovery rate and boosting production. The current 180,000 b/d production of Bangestan could reach 231,000 b/d and total recovery from the field could grow 20%.

Bangestan reservoir was one of the projects introduced for investment when Iran Petroleum Contract (IPC) was unveiled in Tehran to foreign companies.

The huge reservoir is located beneath the city of Ahvaz. Therefore, normal drilling becomes impossible and development of this field must be done through horizontal drilling.

Higher recovery rate does not necessarily result in enhanced production. Furthermore, higher production may often lead to lower recovery rate. Therefore, Iran’s priority in the reservoir will be to raise the recovery rate.

Bangestan has three production units with a rated capacity of 275,000 barrels, three desalination units with a rated capacity of 220,000 barrels and three pressure booster stations with a rated capacity of 177 mcf/d.

NISOC officials have said that enhanced output is not the only objective behind the development of Bangestan reservoir because the 10% recovery rate is low and applying new technologies to boost recovery is of high significance.

The issue of enhanced recovery from oil reservoirs has become a key issue for Iran’s petroleum industry. Some large oil fields in Iran have been producing for more than 50 years and they need to see their recovery rate increase. Such operations require specialized and high-cost technologies.

In the new framework of oil contracts, i.e. IPC, oil companies specializing in enhanced recovery will be remunerated specially. Moreover, the long-term terms of the contract will automatically encourage investment in such projects.

The issue of transfer of technical knowhow and upgrading the management level of petroleum industry are very important. The experience of other countries has indicated that such transfer would not be easy unless in an environment of cooperation.

Iranian petroleum industry practitioners, despite all problems and obstacles, have fulfilled their obligations with regard to foreign companies to prepare the ground for cooperation. However, political concerns resulting from the US’s withdrawal from the 2015 Iran nuclear deal and the concomitant re-imposition of sanctions prevent foreign oil companies from taking the next step forward.

Iran’s oil and gas industry is now in the middle of its lifecycle. Many Iranian oil fields have become mature or are facing sharp production decline due to the lack of modern technology.

Courtesy of Iran Petroleum

News Code 318992

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