IOG boasts successful flow test at Blythe development well

UK gas company IOG plc has drilled, cleaned up, and flow tested the Blythe development well in the UK North Sea, estimating the gas in place and recoverable volumes to be in line with the prognosis.

The Blythe well 48/23a-H1 is the second development well in IOG’s Phase 1 project. The well was spud in early August 2021, using the Noble Hans Deul jack-up rig. It was expected to take under three months to drill and complete.

IOG said in an update on Wednesday that the well was drilled to a Total Depth of 10,750ft Measured Depth (MD), intersecting 1,238 ft of good quality Permian Leman Sandstone reservoir along a hole between 9403 ft MD and 10,641 ft MD, with a net: gross ratio of 95 per cent, porosity at 10.6 per cent and average log-derived permeability of 5.0 milliDarcies (mD). Based on this initial data, the Blythe gas in place and recoverable volumes are estimated to be in line with pre-drill expectations.

Drilling performance saw a notable improvement over Elgood. The company’s drilling, subsurface, and HSE teams have been working with the key drilling contractors Noble Corporation, Schlumberger and the well operator, Petrofac.

Over recent days, the well was successfully cleaned up and flow tested to a maximum gas rate of 45.5 mmscf/d through an 80/64th inch choke. One operational challenge experienced during drilling was the loss of drilling mud due to natural fracturing in the reservoir. This necessitated the use of Lost Circulation Materials (LCM) down-hole which may have constrained the clean-up flow rate with drilling mud being recovered to the surface during clean-up.

IOG pointed out that, due to drilling fluid and LCM being recovered during clean-up, further analysis is required to determine the amount of condensate produced.

The Blythe field is planned to be produced through the Blythe normally unmanned platform, via the 12″ pipeline laid earlier this year, which connects to the main 24″ Saturn Banks pipeline to Bacton. IOG continues to expect the first gas from both the Blythe and Elgood fields in 4Q 2021 once the final subsea and onshore installations are complete.

The Noble Hans Deul rig is expected to mobilise shortly across to Southwark, the third of the Phase 1 fields, where it will spud the next production well through the Southwark platform.

Based on early indications from the Elgood and Blythe clean-up well tests, the company expects that initial production rates from the Blythe Hub upon start-up will be within its planning case range. Specific production guidance is expected to be available once on stream.

In light of exceptionally high forward gas prices, management expects that the company’s cash flows over 2021-22 could substantially exceed its planning base case.

Andrew Hockey, CEO of IOG, commented: “We are now integrating the well data into our planning for the start-up of both Blythe and Elgood in Q4. The improvement in drilling performance at Blythe is also very encouraging as we progress on to Southwark and then on to drill the Goddard and Southern Hub appraisal wells in mid-2022.

“Gas market conditions not just for this coming winter but throughout the forward curve indicate the potential for very strong cash flow generation for IOG over the coming years. We plan to start executing a sensible hedging strategy once on stream, while we also maintain our prudent planning price deck as we work up the next phases of growth”.