RE: RE: RE: UMU-9 Capable of 43,000 BPD TheRock07,
Answers to your questions:
The 43,000 bpd is the calculated total productivity of UMU-9 , as estimated from the average pay productivity times the total pay of all hc zones. Obviously, this would require a huge dh pipe and if possible the RLI would be much shorter. A simpler way of conception, is the cumulative total daily production, if each hc zone were to be produced singly to depletion.
Just objecting to the word "capable" UMU9 is not capable of 43,000 bopd. I understand what you mean but it sets the wrong expectation. BTW only 4 to 5 zones are perforated in each well so you need a workover to get to other zones.
The 21,000 bpd refers to the expanded AGIP pipeline capacity of which Mart 's share ( 80 % ) would be at least 17,000 ( prorata to production, and its my opinion that Mart has in pipe capability to increase production than the smaller fields ). In one of their earlier docs or presentations, they stated that the expansion was expected to be completed by late Q3/12.
Mart's share is not 80%. The production of the other members of the cluster was 3,000 BOPD but is increasing. Expansion discussed recently was to 15K for Umusadege. It is my understanding that AGIP has problems delivering the capacity they committed to the cluster.
Further expansion is being negotiated for 2013 ( from AGM presentation )
Yes but AGIP works on a different calendar. It is the Italian/Nigerian version of the calendar (LOL) Past experience dictates caution on any date from AGIP.
My estimate of doubling production from existing wells was deduced from the current production technique...............dual strings to 4 zones of which 2 can be produced concurrently. As the average is 2000 bpd from each zone, and this now constrained by export capacity, I doubled future potential production per well to 4000 from the current 2000 bpd. If management states ( where ? ) 17,000 to 19,000 bpd , that would supercede my estimate.
This was stated during the AGM.
I recall that Mart took 82 % of Q2 field production ( cost recovery ). The UMU-10 well will probably cost in the same range as UMU-9, so Q3 should also have a high ratio of Mart production to total umu field production.
82.5% is the contractual max Mart can recover in one quarter. We hit that number in Q1 2012 due to the high cost of UMU9. Q2 recovery numbers are not out but I can guess it is much lower than Q1 since we had very little drilling expenses. If you estimate the Q3 production a 12,000 bopd with 75 production days and $100 per barrel the cost recovery for a $14M UMU10 is 16.5% of the quarter's production, so Mart would take 66.5% of the production. That is in line with previous quarters in 2011. Total year for 2011 was 71% due to a very high Q4.
In reviewing my notes, the 35,000 bpd export expansion from the Shell/Agini proposed new pipeline expansion was in error.....it is actually the expanded CPF capability. I gather from your commentary that the Agini proposed capability will be 60,000 bpd and further expandable.The actual capability allocated on the 200,000 bpd Shell pipeline remains uncertain ( as you point out ).
It is the Ogini pipeline and the 60K is IMO.
As Shell is ( I believe ) buying Marts oil at entry to their pipeline and in view of the fact that Umu field is the largest producer feeding the Agini pipeline, one might expect that its 60,000 bpd capability would reflect at least 30,000 bpd capability for Mart.
Oil is purchased at lifting site (Shell terminal) . At least that's the case for AGIP and there is no reason it is different for Shell. It means that loses on the line get charged to Mart. Loses can be bunkering or temperature change. Anybody feeding into the new Ogini pipeline would be a customer of the pipeline joint venture (Mart + its partners). The joint venture would have full control of who gets in and of course Umusadege is the number one priority. All IMO.
This is from the Pipeline NR: "the 54km Ogini Pipeline, which will have a design capacity to accommodate both existing and future expanded production levels from the Umusadege field." They are talking about the field not just Mart.
Speaking of joint venture, you need to understand that Mart does not really sell the oil, the Umusadege joint venture does. The funds are distributed to the partners and to the so called restricted cash account to pay for taxes. Mart manages the transactions.
Mart will receive DUAL benefit from its ownership/working interest of part of the Agini...........where did you get 15 % ?
Very simple, listen to the AGM. Wade states during his talk that Mart will get 15% equity. Mart wanted more but that's what they got.
Cheers