Tuesday February 01, 2005

Drilling for oil : South Africa

energybulletin.net -> busrep.co.za :

Drilling will begin on the first of two deepwater oil exploration wells off the west coast of South Africa at the end of April at a combined cost of about $100 million (R595 million).

Jack Holliday, the chief executive of the Petroleum Agency South Africa, said international energy companies such as BHP Billiton Petroleum, Forest Exploration and Occidental Petroleum would be the first ever to drill deepwater exploration wells in South African waters.

... each well will cost between $30 million and $50 million to drill. One of the reasons Holliday said these holes were so expensive was because dynamic drill rigs were in short supply and came with a $250 000 a day price tag.

Holliday painted a sobering picture of the world's energy situation at a conference held in Johannesburg on Friday. He said that, put in simple terms, the world was only discovering 6 billion barrels a year while it was consuming 27 billion barrels a year.

"We are draining reserves four times faster than they are being filled."

According to the average statistics of the major oil companies on global oil reserves the world had about 1.93 trillion barrels of oil. The world consumes 700 000 barrels of oil every 10 minutes, or 1 billion barrels every 14 days. There is huge urgency to find more oil reserves, but oil exploration is very high risk and very expensive.

"Sometime in our lifetime we are likely to see the effect of production not being able to meet an ever growing demand."

(2005-02-01 11:35:21 SGT) [Energy] Permalink

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