BPC on track to spud exploratory well in six weeks

BPC on track to spud exploratory well in six weeks
The Bahamas Petroleum Company logo.

NASSAU, BAHAMAS — Bahamas Petroleum Company (BPC) yesterday confirmed that it is on track to spud its exploratory well within six weeks, with the company indicating that it plans to complete all well activities prior to mid-April 2021.

The company in an update to investors yesterday noted that Perseverance #1 is on track to spud before the end of 2020 and that drilling of this potential basin-opening well anticipated to take between 45 and 60 days, with “tight-hole” procedures in place. The company also indicated that it is targeting recoverable prospective resources of 0.7 billion barrels of oil, with an upside of 1.44 billion barrels.

Stena Drilling’s Stena ICEMax drillship is preparing to set sail soon to The Bahamas to spud the well. The company said yesterday that the drillship had completed all necessary vessel and equipment inspections, and is scheduled to leave the dock in the Canary Islands before the end of this month.

The company also indicated that it has received formal notification from the government of The Bahamas of a further extension of the second exploration period of BPC’s licenses, from mid-April 2021 to the end of June 2021, reflective of the ongoing impacts of the COVID-19 force majeure.

Simon Potter, BPC CEO, said, “Many shareholders have been extremely patient and have stayed the distance, as has the majority of the management team, and we are now in the position to deliver the Perseverance #1 exploration well in compliance with our long-held exploration licenses in The Bahamas. Perseverance #1 is a potentially basin-opening well, with the kind of scale and associated value uplift exposure rarely offered outside of oil majors.

”At the same time, our activities, in the event of success, have the capacity to be economically transformative for the nation of The Bahamas, and could ultimately contribute billions of dollars in royalty revenues to the national treasury, at a time when the dual impact of recent hurricanes and the COVID-19 pandemic has been especially hard-felt by most Bahamians.”

Potter added, “Many other nations in the region such as USA, Mexico, Trinidad and Tobago, Suriname and Guyana have over the past decade safely and responsibly drilled offshore wells, developed or continue to develop offshore hydrocarbon resources and reaped the economic benefits of an established or a whole new industry. Moreover, these other nations have been able to do so at the same time as seeing growth and development of existing industry sectors, such as tourism. BPC is fully committed to ensuring safe and responsible operations, and has assembled an experienced team of drilling personnel, supported by many of the world’s largest and most respected oil services contractors, with a collective track record of drilling many thousands of wells safely, all around the globe. We are especially pleased that one of the most modern, technically capable drilling vessels in the world will soon leave port ahead of drilling. In support of this, logistics plans to mobilize both equipment and personnel safely to site have been finalized, funding is in place and we have completed a huge body of work to ensure that best practices have been applied as our health and environmental safety plans and protocols have been developed, contracted and approved.”

As the oil explorer pushes towards drilling its exploratory well, its efforts have been met with fierce opposition from environmentalists. The company steadfastly maintained that its environmental submissions are fully compliant with Bahamian law as well as international standards and best practices

The company yesterday noted that in accordance with Bahamian law and the terms of its licences, it was required to prepare and submit a comprehensive Environmental Authorization to the government of The Bahamas, inclusive of a detailed environmental impact assessment and environmental management plan.

“This was reviewed for the government of The Bahamas by independent third-party industry experts, and certified to be in compliance with not only all applicable Bahamian laws and regulations, but consistent with all applicable international standards, guidelines, regulations and global best practice. Following that review, BPC’s proposed drilling program for Perseverance #1 was approved by the government of The Bahamas, and Environmental Authorization was granted. The approvals obtained relate specifically to the drilling of Perseverance #1, such that in the event of success, drilling of any subsequent wells in The Bahamas will be subject to a separate and equally exhaustive approvals process,” BPC’s statement read.

It, “The drilling program for Perseverance #1 is expected to take between 45 and 60 days, and will be undertaken on a ‘tight-hole’ basis — an industry protocol (and one required by the government of The Bahamas) whereby real-time well information and drilling results will generally be kept confidential until the conclusion of drilling and testing procedures, and until any appropriate notifications to government representatives have been made. The well has been designed specifically as an exploration well, with the sole objective of establishing the presence of hydrocarbons through a range of tests that will be conducted as the well is drilled. Perseverance #1 has not been designed to ever operate as a production well, such that at the conclusion of the drilling program the well will be permanently sealed and then abandoned.”

BPC also noted that it is currently working with the government of The Bahamas’ appointed third-party expert adviser, international environmental consultants Black & Veatch, on a number of technical items relating to the Perseverance #1 drilling program.

“As agreed with the government of The Bahamas, one or more Black & Veatch experts will be stationed onboard the Stena IceMAX during drilling operations, and will oversee the entire drilling program, with a specific mandate from the government of The Bahamas to observe and report on specific tasks, activities and operations, including observing the baseline seafloor survey and testing of drilling fluids to ensure compliance with mandated safety requirements, oversight of environmental compliance activities during drilling activities and thereafter during decommissioning and abandonment activities and monitoring drilling practices, procedures and activities, to assure compliance with the program environmental impact assessment (EIA) and environmental management plan (EMP),” the statement read.