Lukoil #344 (February-March 2019)

Over the course of a rainy and windy January 2019, two drilling rigs were rigged up on the Cluster #4 at Iraq’sWest Qurna-2 oilfield in anticipation of the 28wells that are to be drilled at theMishrif formation. The rig-up works were completed one week ahead of schedule. ANOTHER PLUNGE INTO THE EARTH’S BOWELS: LUKOIL BEGINS NEW DRILLING CAMPAIGN IN IRAQ The operator of the Deepwater Tano Cape Three Points (DWT/CTP) block Aker Energy announces that it encountered oil in the Pecan South-1A well offshore Ghana. “The drilling result is another confirmation of the geological model for the area. We will continue the appraisal drilling campaign, while finalizing the Plan of Development to be submitted by Aker Energy announced successful drilling results the end of March,” says Jan Arve Haugan, CEO of Aker Energy. Aker Energy estimates that the total volumes to be included in a Plan of Development will reach 600 – 1,000 mmboe. Aker Energy (50%) runs the project in cooperation with LUKOIL (38%), Ghana National PetroleumCorporation (GNPC) (10%) and Fueltrade (2%). Т he contractor – Bohai Dr i l l i ng Company (BHDC) – already has a history with LUKOIL: its BHDC 37 rig, which will drill 16 of the 28 wells, was used at West Qurna-2 during a previous drilling campaign in 2013-14. LUKOIL’s own dr i l l i ng staf f is enthusiastic about the undertaking. In total the company has just signed three contracts for 57 wells: 54 at Mishrif and three at the Yamama formation. It will allow LUKOIL to reach production target of 480 thousand bpd in 2020 and 800 thousand bpd in 2025. While the Mishrif wells will be drilled by BHDC, the Yamama ones will be completed by another Chinese contractor – ZPEC. LUKOIL is the first company in Iraq to set up a completely new well pad with two drilling rigs rigged up simultaneously. This type of operation is more common in Western Siberia, where artificial islands are often the only possible base for well pads. In the Middle East, one well pad will typically accommodate a single rig that can drill 4–8 wells in total.Working on such cluster is a challenging task, as all operations – drilling, completion and hook up – are performed simultaneously. О n March 6, 2019 a new checkpoint in the security perimeter was commissioned onWest Qurna-2 oilfield as part of the annual work program. Checkpoint along with new access road and groundwork for Cluster #3 are essential parts of the infrastructure required for further development of the field’s production capacity. The next stage will include drilling, completion and bringing on stream 13 production wells at this site. This infrastructure is designed bypassing residential areas to keep local citizens unaffected with traffic. The main aim of the checkpoint is to keep oilfield secured, monitor access, record and screen cargos delivered to the production site. The contract for construction works was awarded to 77 Insaat Ve Taahhut Anonim Sirketi – a company that already has working experience with LUKOIL Mid-East Limited. The checkpoint has all necessary features for operating in hot climate conditions – for both employees and K-9 dogs. The commission led by LMELHR and Secur it y Di rec tor Ki r i l l Podgorny y forma l ly accepted checkpoint into service. The official ceremony was also attended by the representatives of capital construction directorate, facilities and road maintenance department as well as management of the contractor company. Tarek Mattar, drilling supervisor: "I’ve worked in Saudi Arabia and Egypt in the past, but didn’t see this type of cluster with two drilling rigs in either of them. It may be the only one of its kind in the Middle East. All of the wells are in line between the two rigs, and sub-surface targets are all around. It looks like a big network not unlike those created for offshore drilling. With cluster drilling, step-out (horizontal distance between surface and target) could exceed 3,000 meters while in case of single well drilling it will be much less. I’m very happy to have the unique experience of working on this project: new technologies, modern software and a lot of information. It boggles the mind". There can be up to 300 people at the cluster at the same time. Dif ferent depa r tments must carefully coordinate their work so processes proceed smoothly and without interruptions. Another issue is security. After several instances of civil unrest in 2018, LUKOIL is paying great attention to production facilities’ defense. The company is tightening its security rules and requesting its contractors do the same. One of the key demands of locals during protests last summer was for more jobs. The upcoming drilling campaign offers hope in this regard, as contractors and sub- contractors should be able to hire up to 500 local residents from the Medeina, Ezz-Eldin Salem,Qurna and nearby districts. All parties are optimistic about the upcoming developments at West Qurna-2: LUKOIL hopes to receive timely compensation and remuneration, the Basra Oil Company will benefit from higher export volumes and state-of-the- art production facilities and local residents are looking forward to higher living standards and new employment opportunities. Now a ll sides must work together in order to turn these expectations into reality. NEW INFRASTRUCTURE COMMISSIONED ON WEST QURNA-2 2 Business