Deepwater Invictus

• Broadside well fails

to find oil or gas

• BHP cannot comment

at this stage

• Geologist still believes big oil to be found

In what could be a major blow to the aspirations of the T&T’s energy sector, BHP’s deep-water well Broadside has failed to find oil or gas and is a dry hole. The well which carried with it the hopes of T&T and the expectation of a massive deep water oil discovery proved unsuccessful.

The Business Guardian has confirmed from multiple sources that the well did not find any oil or gas and had several challenges while it was being drilled.

BHP Billiton yesterday told the Business Guardian that is was just not in a position to comment on the situation. The company was asked the following questions:

• Can BHP confirm that its Broadside well was unfortunately unsuccessful and was a dry hole?

• What does this mean for its exploration plans in the southern basin?

• Is this effectively the end of its exploration programme and will there now be a focus on the Northern Licence?

Its spokesperson Judy Dane responded by simply saying: “I checked with the team and we aren’t able to comment on this at this time.”

On September 15, Prime Minister Dr Keith Rowley hosted an event at the diplomatic centre at which he praised the company for its continued interest in T&T and noted that BHP had begun drilling its Broadside-1 well which was expected to test the oil play within BHP’s Southern Deep-water Blocks, which includes TTDAA 3, 5 and 6.

“If the finds of the Broadside well are promising, it can inform the drilling of further exploration wells in nearby blocks. Additionally, a commercial discovery in any of Broadside’s Miocene targets could de-risk the majority of the prospective resources identified by Netherland, Sewell and Associates, Inc (NSAI) in its audit of the country’s crude oil reserves and resources for year-end 2018.’ Rowley noted.

This was not to be and shortly after the event the drilling of the well encountered problems with stuck pipe and while the company was able to eventually continue drilling, it never hit any of its targets and found nothing.

One of the country’s leading geologists Dr Krishna Persad said he was very disappointed by the results but admitted that exploration was risky.

He added, “The reality is that in exploration you have a thirty, maybe 40 per cent chance of success and therefore seven of every ten wells you drill will be a dry hole. BHP had a tremendous run of success in the Northern License closer to Barbados but that is not always replicated.”

Dr Persad said all was not lost as he is convinced that there was significant oil and gas to be found in T&T’s deepwater but BHP had just not found it as yet.

BHP has drilled four exploration wells in the Southern acreage and has not found oil. It has found some gas and condensate but no oil. This has made those gas discoveries uneconomic since they have not been large enough for deepwater.

Persad said that T&T was in the middle of a trend that started in Barbados and extended to parts of Guyana, that it was proven the necessary source-rock was there and so to were the reservoirs.

He does not believe that the source rocks are so old that the window of opportunity for the oil and gas to be in them is now closed.

Earlier this year BHP’s vice president, Exploration Sonia Scarselli in an exclusive interview with the Business Guardian spoke extensively about the Broadside well.

Scarselli said Broadside 1 would target a much deeper horizon.

“So we will penetrate the shallowness of that interval where we encountered oil seeps in the Le Clerc and Victoria wells but we will now go drilling deeper than we have done in the past.

“Since we have a much larger understanding, a better understanding of the full hydrocarbon systems and potential for the area. In the Le Clerc well we encountered the oil seeps. So part of the well we will drill the next couple of months it is to test this oil potential.”

Scarselli said in the original Le Clerc well, the plan was to drill to relatively shallow depth but when there was gas and then oil seeps were found so the company decided to continue drilling given that it was a frontier basin and wild-cat exploration it wanted to take as much information as it could from the well and only stopped when the pressure came too much to continue. So now they have a better understanding of the geology BHP will take another look at the acreage.

BHP’s vice president Exploration said in the case of the North the company does not expect to find oil because she believes that the source rock is over mature.

“We tested that so we don’t expect to find any lead with that. In the South is a different story, so in the South, because we encountered the shallow section was biogenic so it was locally sourced. So expect to go deeper to find oil because we don’t think the oil has migrated shallow enough.

“It takes a certain amount of time for the oil to migrate through the rocks and because of the level of maturity in the south we don’t think it has migrated that shallow yet,” Scarselli said.

She said there are similarities and differences in the Guyana and T&T deep water and the company incorporated the information from Guyana to a mega-regional view of the basin.

She said the source rock we have in T&T deepwater is a Cretaceous source rock in the Cenonian age which is similar to what there is in Guyana and most of the Central Atlantic.

She noted, however, in terms of the fold of play, there are differences. “There are differences in water systems and age compared with where we are looking, the main difference is the age of maturity of the source rock in Guyana vs T&T. So certainly we’ll learn a lot from the experience there but we’re also looking at different petroleum system overall,” Scarselli said.

Scarselli said BHP’s strategy is to target tier-one opportunities. She explained: “We want to find the traps so we can deliver multiple hundred million barrels of discovery. So that is like really the minimum threshold that we are looking and it could be a set of multiple traps that can deliver this amount. Normally, when you open a new play you can find maybe some larger traps and smaller traps but necessarily you need to have quite a large amount to move forward with the development, because we are targeting large trap we are looking for the deepwater it is sort of numbers we are talking about,” Scarselli ended.

With exploration budgets slashed globally its anyone’s guess if BHP will continue to have interest in the Southern License.

Energy Minister Franklyn Khan has been on record as saying that the government wanted to have the results of the Broadside well before going out in the first quarter with a new deep-water bid round. This news could not have helped T&T’s cause.