Setting
The five Karoon blocks 1037, 1101, 1102, 1165 and 1166 are located 220 kilometers off the coast of Santa Catarina state, just south of Rio de Janeiro. They lie in relatively shallow water (300-400m) on trend with the Piracucá (oil), Caravela (oil) and Merluza (gas) fields. In April 2009 Petrobras/Respol declared the BM-S-7 Piracucá light oil field a commercial discovery. The field is only 5 kilometers to the northeast of Karoon acreage and is reported to contain 550 Mmboe in place (Repsol, 2009). The Late Santonian reservoirs produced 3476 bopd with 126,800 m3/d of gas in preliminary tests (Repsol, November 2009). Petrobras is currently considering a FPSO development that could be tied to a number of the discoveries in the designated Pólo Sul shallow water area (Petrobras, 2009).
Karoon now has a large and comprehensive database over the Santos Basin having purchased well data and 20,500 km of regional 2D lines and 6000 sq km of 3D seismic data. Karoon has reprocessed 2500 sq km PreSTM and 900 sq km PreSDM providing a unique insight into Karoon's acreage and surrounding blocks.
Interest
Karoon has 100% equity and is operator of all blocks acquired from ANP bid round 9 (2007) which was awarded in March 2008.
Potential
Five prospects associated with three diapiric salt structures have been worked up with two prospects, Pico do Jaragua East and Pico do Jaragua West ready to drill. These have a mean Prospective Resource potential of 398 mmbo and 228 mmbo recoverable respectively.
The application of quantitative seismic interpretation technology has resulted in the identification of substantial low risk targets in these shallow water (300-400m) blocks. Further to this Karoon has identified potentially large subsalt and deeper prospectivity based on current prestack depth migration. This additional prospectivity will be better defined using the contracted multi azimuth 3D acquisition started in February 2010.
Total unrisked mean prospective resource in all prospects and leads exceeds 1 billion barrels.
Work program
Karoon has been conducting extensive geological and geophysical work over the financial year on its Brazilian blocks using the new seismic acquired in 2009. To the best of Karoon’s knowledge, the 2010 seismic acquisition program will be the first application of wide azimuth 3D seismic acquisition in Brazil. This seismic will fulfill the third year work program commitments and prepare Karoon for a future drilling campaign starting in 2011.
Remaining Work Program commitments are to acquire 510 sq km wide azimuth 3D seismic acquisition in early 2010. Then drill one well in each block during the optional second term of 2 years (starting April 2011).
Karoon has followed two main workflows for specific play types;
- For sub salt (beneath the mobile allochthanous salt structures) and pre salt plays (beneath stratigraphically older autochthanous salt), Karoon has used Pre stack depth migration to image traps not seen on conventional 3D data sets.
- For non salt affected plays, Karoon has employed detailed true amplitude pre stack time migration followed by well trending and inversion work for prediction of hydrocarbons.
Both workflows have been successful in producing high quality data resulting in high confidence prospects. Application of similar new technologies by other operators has seen increased exploration success in the basin.
Surrounding areas activity
Brazil has opened up its oil and gas exploration and development industry post the mid 1990’s in a bid to reach self sufficiency in energy. This has included a transfer of regulatory control to the ANP. The level of exploration activity in the Santos Basin offshore southern Brazil has varied over the last 10 years with the entry of major oil companies Shell, Total, Exxon, BG and ENI aiming to test the deep water plays identified. On the shallower water shelf new entrants include Karoon, Repsol, Woodside and Norske together with other Brazilian companies: Vale, Queiroz Galvao, Starfish and OGX.
Major discoveries (Table 1) have occurred within the basin along the shelf to deepwater. The discoveries in Table 1 illustrate the post salt and account for over 2.7 bboe. Numbers are from WoodMackenzie published data, although recent press report even greater volumes. The table excludes the deep and ultra deep water recent giant discoveries made in the Pre-Salt (e.g Tupi, Carioca, Iara etc) which account for a further 7+ Billion barrels of oil equivalent.
Table 1. Post Salt Discoveries in Santos Basin (sources include press releases, ANP and WoodMackenzie 2010 resource estimates mmboe)
Geology
Within the permits there is potential for a range of play types from tilted fault block plays to salt related plays. The primary reservoirs are within the Upper Cretaceous (Maastrichtian through Santonian) clastics which have penetrated regionally within the basin and have good reservoir quality characteristics down to around approximately 3800m of burial. A secondary target is present at the deeper Albian carbonates level. Discoveries have been made at both levels with nearby fields producing mainly from the Albian carbonates. The seals for the traps are interpreted to be marine shales which form good quality seals at Piracucá.
There are two principle source rocks in the Santos / Campos Basins; the Aptian source rock which has sourced much of the oil in the Campos Basin to date and the Cenomanian-Turonian marine source rocks which are the effective source for much of the oil seen in the southern part of the Santos Basin.
February 2010