Petro-Tech to Invest US$15mn-20mn in Peru Exploration

Peruvian oil company Petro-Tech Peruana plans to invest US$15mn-20mn to explore offshore blocks in Peru in 2004, the company's geosciences manager Pedro Alarcon told BNamericas.

"For now we are more interested in offshore exploration because the company has the training and the technology to work offshore, but if we see an interesting onshore opportunity we will look at that," Alarcon said. The company aims to sign an exploration and production contract with state hydrocarbons investment agency Perupetro in the first quarter of 2004 for offshore blocks Z-21 and Z-22 in the south of the country, Alarcon said.

The concession will likely combine the two blocks into a single block, he added. Petro-Tech has wrapped up a technical evaluation of the blocks, and perspectives for hydrocarbons are "very interesting," Alarcon said, adding that if the contract is signed as planned early next year, the company would invest some US$5mn in 2D and 3D seismic studies in 2004.

Petro-Tech could also partner with other companies to explore four offshore blocks currently being promoted by Perupetro in the Talara-Tumbes and Trujillo areas, Alarcon said, adding that the deepwater blocks are too expensive to drill for Petro-Tech alone. The company has delayed plans to drill two exploration wells in its northeastern Z-2B block to January from November.

The two wells, which will cost a total US$5mn-US$6mn, are designed to replace declining production on the block. Production on Z-2B has fallen to about 11,200 barrels a day (b/d) from 12,100b/d on December 31, 2002, Alarcon said, adding gas production is about 70 million cubic feet a day (mcf/d). The Z-2B drilling could increase production by 5,000-10,000b/d in 2004, he said, adding that associated gas production could also increase.

The first well to be drilled is Chira, which is in about 50 feet of water and will be drilled to a depth of 7,800 feet. The second well, San Pedro, is in 250 feet of water and will be drilled to 7,400 feet. The location of the wells was decided after processing 4,000km of 2D seismic. "The perspectives are very good," Alarcon said.

Meanwhile, just to the south of Z-2B on block Z-6 Petro-Tech will invest US$3mn to carry out 2D seismic studies starting in April 2004, Alarcon said, adding that 3D seismic would then follow.

Petro-Tech is 100% owned by Houston-based Petro-Tech International.

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