Japan Petroleum Exploration plans to start drilling Japan's first horizontal shale exploration well at its onshore Fukumezawa oil field in Akita prefecture in the northwest for about one month from May 22, a company official said Tuesday.
Japex will drill the Fukumezawa SK-26D pilot well to a depth of around 1,330 meters and extend it horizontally to drill the Fukumezawa SK-26DH well about 2,300 meters by around late June, Japex said.
From the horizontal well, Japex will conduct multi-stage fracturing in November-December with an eye to reporting the data collected after spring 2015, another company official has said.
Since the discovery of conventional crude oil in 1964, more than 20 wells have been drilled at the Fukumezawa field, according to the company, declining to comment on current production. The Fukumezawa field is about 100 km north of the Ayukawa field, both lying on the Onnagawa tight formation.
Japex's drilling of the country's first horizontal shale exploration well will come after it said April 7 that the company started commercial production of shale oil at its wholly-owned onshore Ayukawa oil and gas field earlier in the month in Akita prefecture.
Japex declined to comment on any costs associated with its shale oil activities in Japan.
Japex has started producing around 220 b/d of medium-grade crude from the Onnagawa tight formation, using the existing vertical Kurosawa AK-1 well after it produced 252 b/d of shale oil during its second flow test over May 13-July 10 last year.
Japex has started shipping the Ayukawa shale oil via tanker trucks to JX Nippon Oil & Energy's Funakawa crude storage terminal in Akita prefecture, where it ships it on vessels to local refiners, according to company officials, adding that its shale oil will be indexed to Japan's average CIF crude import prices.
Japex has said it estimates there are 100 million barrels of recoverable petroleum reserves in Akita prefecture, and the Ayukawa and Yurihara fields alone are estimated to hold 5 million barrels.
In fiscal 2014-15 (April-March), Japex plans to run a 3D survey over 63 square km in around the Yurihara oil and gas field in Akita over October-December for its existing developments as well as part of its efforts to search shale or tight oil in the region, the official said.
In next few weeks, Japex also expects to have results from its Akebono exploration well, which has been drilled near its Yufutsu oil and gas field in Hokkaido since November last year, the official added.
ADVANCING TARGET TO REACH 70,000 BOE/D OUTPUT BY MAR 2015
In the fiscal year ended March 31, Japex produced 48,000 b/d of oil equivalent, up from 36,000 boe/d in the previous fiscal year as a result of the start-up of the Gharraf oil field in southern Iraq, the official said.
In other projects update released Tuesday, Japex now expects to be able to reach a target oil and production of 70,000 b/d of oil equivalent in fiscal 2014-15, earlier than its original target of March 2016 as it expects to see a hike in its crude sales from Gharraf, the official said.
The field consortium comprises Petronas with a 45% stake, Japex Garraf with 30% and Iraq's North Oil Co. with 25%. Japex holds a 55% stake in Japex Garraf, with Jogmec holding a 35% stake and Mitsubishi 10%.
Meanwhile, Japex also expects to reach 405 million boe of proven reserves by March 2017, advancing from its earlier target of March 2021, as the Pacific NorthWest LNG project in Canada, where it has a 10% stake, is scheduled to make a final investment decision at the end of 2014, the official said.
Japex has the equity share of 1.2 million mt/year of LNG from the 12 million mt/year Pacific NorthWest LNG project, which is scheduled to start up at the end of 2018.
