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Eni, Italy’s energy giant, and Repsol of Spain have begun production at the Perla gas field off the coast of Venezuela, the largest known offshore deposit in Latin America, which contains an estimated 17 trillion cubic feet of gas.
“Perla was for Eni one of the most significant start-up projects of 2015, and the today result confirms the validity of our development model that allowed us to reach production in an industry-leading time to market,” Eni CEO Claudio Descalzi said in a statement.
The field is located about 30 miles offshore as part of the Cardon IV reserve area in the Gulf of Venezuela on the Caribbean Coast. Perla, which is believed to be one of the largest gas discoveries in history, will be operated by a joint venture of Eni and Repsol, each with a 50 percent stake in the project.
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In its initial phase, the field is expected to produce about 450 million cubic feet of gas by the end of 2015 and 1.2 billion cubic feet of gas per day once production reaches its peak in 2020. This staggered approach to output is meant to optimize the product’s time to market and the pace of investment in the field.
Eni said it took the two companies only five years to develop the field, the fastest any such deposit has been developed, thanks in large part to close cooperation from Venezuela’s Ministry of Petroleum and Mining; Petroleos de Venezuela, SA (PDVSA), the state-owned energy company; and the shareholders in the Cardon IV gas block.
Eni and Repsol plan to use four light offshore drilling platforms using a pipeline to transport the gas to an onshore central processing facility at Punto Fijo as well as to 21 storage wells there.
The two companies discovered the Cardon IV block in 2009, and since then have worked together to drill seven of the 26 gas wells envisioned under their development plans.
The timing of Perla’s development was critical. Descalzi was meeting with Venezuelan energy officials in December at a time when oil prices were nearing their lowest point – $50 per barrel – in their year-long decline. While Eni was talking concrete development, many other energy companies were cutting back on staff and exploration because of the price plunge.
The startup of Perla also is key to Repsol’s development strategy. It is the eighth important growth project to be launched as part of the Spanish company’s strategic plan for the 2012-2016 period. The other projects operating under that plan are in Bolivia, Brazil, Peru, Russia, Spain, the United States and Venezuela.
Eni’s other projects in Venezuela include the Junin-5 block of heavy oil, which began production in March 2013 and contains confirmed reserves 35 billion barrels of crude. Eni owns a 40 percent interest in Junin-5 and PDVSA owns a 60 percent share.
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It also owns 26 percent of PetroSucre, the company that operates the offshore Corocoro oil field; PDVSA owns the remaining 74 percent of the company.
All told, Eni’s net production in Venezuela is about 12,000 barrels of oil equivalent per day, and output is expected to top 50,000 barrels of oil equivalent per day by the end of the year, due mostly to the new production at Perla.
By Andy Tully Of Oilprice.com
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Andy Tully is a veteran news reporter who is now the news editor for Oilprice.com