Romania E&P: The Candy Shop is Full...
Prospects for oil and gas developments in Romania are plentiful, if one can navigate through the obstacles, according to Gehrig Schultz, Chairman of the Board and CEO, Prospectiuni, at the Romania Oil & Gas conference in Bucharest.
He said that while the “candy shop” is full, accessing it required a note from mom.
“Here we are in Romania, which is the richest place in Europe, that has all kinds of oil and gas resources that have been discovered, or are still in our minds, but it's pretty difficult to get on the land to do our work,” he explained, despite the great technologies available to the industry, like completing wells innovatively, for example.
But, he said, the industrial environment has changed, making it difficult to do measurements, drill wells and execute programs.
As an anecdote he recalled, “When I arrived in Romania, after we got an award for a seismic contract we could be out in the field 2-3 weeks later; now, on some of our jobs, it's 180 days, and in some conflicted areas we're running on almost 240 days.”
Mr. Schultz listed some of the impediments like government permitting, EU requirements as well as local regulations. One recent one, which he said made sense, is the “trace and track” regulation on industrial explosives.
Land access, he explained, has also become vastly more complex.
“There's a lot of fear, and this fear is created by people who have particular agendas. I've had conversations with some who say 'well, we oppose seismic acquisition, because if you don't do seismic, then nobody will drill a well, and if nobody drills a well you'll need energy from another place, so you'll make a windmill, a solar panel or something else.' So it's very definite - the anti hydrocarbon agenda.”
Activists in Romania, he said, are spreading fear among locals that there land will be poisoned, water tainted, crops fallow, etc. “Some of these people don't have information and they're distrustful of many information sources,” he explained. “We've tried to go through the media, but they're not always the best source because the loudest voices get reported most. The voices that sell the most newspapers, which are often the most frightening, get the front page. And the technical article that explains exactly what will happen gets put on page 33.”
He also said that the question of who benefits from oil and gas developments was a potential area of conflict with communities, who wanted to know whether drillers were going to buy in local shops, or whether such activities would create jobs for local people. Mr. Schultz admitted that locals can serve in seismic crews, but increased skill levels are needed further up the O&G value chain.
Meanwhile, land entry permits are sticking points in Romania, he said, because of unreliable cadastral maps that threw into question who owns land. Legal battles can occur between concession holders and landowners, according to him.
But, he said, people are looking to develop their communities. As schools in Romania without running water are being forced to close, Mr. Schultz reported that oil and gas companies are drilling water wells to help keep them open. “We can help,” he remarked.
“If we can, as an industry, work with communities, help them be stronger, have benefits... we'll win the battle in the end. We have to be out there and be integrated,” he said, “to build trust throughout the long-term development of an oil and gas field.”
Offering perspectives on offshore operations, Gabriel Ionescu, Director Exploration Division, OMV Petrom, noted that offshore exploration can be expensive.
He explained, “That's why it's a common practice in our industry to take every effort to de risk projects before getting to the drilling stage – the big money stage.”
With that in mind, he said he would share OMV Petrom's experience in de risking projects.
He named the company's exploration licenses in the Neptun (with ExxonMobil), Histria and Midia offshore blocks.
Mr. Ionescu spoke of a big 3D seismic drilling campaign that the company had initiated in 2012-13 in order to classify the play types. He commented, “Out of the 10 play types, we can see that maybe five of them are proven, five are unproven.”
He noted the challenges along the company's Histria block: “We are not speaking about large projects, but small to medium sized ones. We have a couple of small discoveries in shallow water.”
These, he said, will be clustered into small discoveries.
“Dealing with small projects it's a must to have better imaging of the internal sedimentology, the stratigraphy, inter structural model of these projects.”
That mandated the use of broadband seismic, he recalled, which records a broader array of frequencies. The advantages of doing this, said Mr. Ionescu, can be seen all along the E&P lifecycle.
“He offered, “One can see that the results we got are quite encouraging for drilling – some striking features. It's giving us more confidence in these direct hydrocarbon indicators – very encouraging for us.”
He concluded that exploratory drilling was planned some time in the next two years.
-Drew Leifheit