ENAP: Successful Fracking for Tight Gas, Chile

Empresa Nacional del Petróleo (ENAP) of Chile reported the successful intervention to exploration wells known as hydraulic fracturing to produce unconventional gas from the glauconitic zone of Block Arenal, where ENAP operates without partners, located on Tierra del Fuego Island (Chile).

This first unconventional gas production is a result of the intervention of vertical exploration wells drilled in late 2012 and early 2013, with rigs owned by ENAP. The wells were subject to these operations to increase the permeability of the rock and facilitate the gas flow. While starting the test period, the initial flow rates reached up to 120,000 m3/day average per gas well plus a few cubic meters of condensate.

This flow will decline until the stabilization of the well. Although these preliminary figures may vary, ENAP described these results as the identification of a new unconventional gas field.

A collector of 40 kilometers and parallel to the work of intervention was built to start gas production. The production during the testing phase will be used to supply the inhabitants of Punta Arenas and Tierra del Fuego. As explained Hesketh Streeter, Exploration and Production Manager of ENAP, “these results will provide greater operational flexibility to meet gas demand of the city during the winter 2013 and continue working on the deficit of winter 2014”.

In turn, Ricardo Cruzat, ENAP general manager, explained that “this work is to test the hypothesis about the existence and potential production of tight gas in the Magallanes basin in which we have worked. Although these results are an important milestone for our exploration strategy, we must await the results of the final technical and financial evaluation that will be obtained when these wells are connected to the pipeline, production is stabilized and productivity can be quantified, which is what determines the volume of recoverable reserves from the new reservoir.”

Ricardo Cruzat added that “this year ENAP is investing more than US$ 100 million in the Magallanes Region, the highest investment in the last 15 years. We take these results with calm and stick with the plan designed two years ago. Later we will know more details about the scale and future potential of this discovery, and we are already planning the next steps that could mean drilling more wells.”

Similarly, Hesketh Streeter added that “this is a business where we have to live with uncertainty and decisions must be taken with courage. These results would not have been possible without the effort of ENAP workers, professionals and executives, and the support of the Ministry of Energy, Ministry of Finance and other authorities. Our workers have been able to integrate their experience with the knowledge of an internationally recognized expert consultant and the services of specialist companies such as Weatherford and Cameron. This is how these technical challenges are faced in the international oil industry.”

Reinforcing its message on safety, the executive emphasized that “I want to congratulate all our employees, because to achieve this result they have applied our principles of safe work: Visible leadership, self-care, work control and integration, to meet this activity with no accidents or impacts on the environment.”