A Houston independent has advanced to the brink of an onshore/offshore project to supply natural gas to northwestern Peru and southwestern Ecuador.
The $60-90 million first phase of the project, said newly public BPZ Energy Inc., would involve laying a 10-mile pipe- line to haul gas from Corvina field in the Pacific Ocean to a power plant at Caleta La Cruz, 75 miles northeast of Talara (see map).
BPZ would install 140 Mw of gas-fired generating capacity at Caleta La Cruz adjacent to an existing 19 Mw oil-fired power plant operated by ElectroPeru.
Overall, BPZ holds exclusive rights and license agreements covering 2.7 million acres on four properties in northwestern Peru and a small nonoperated interest in a producing property in southwestern Ecuador. It plans to obtain funds via debt, equity, joint venture, and/or lease financing.
Eventually, it envisions supplying gas as far as Guayaquil, Ecuador, 90 miles north of Corvina field.
Peruvian gas fields
Other operators discovered and appraised Corvina and Piedra Redonda fields, on Block Z-1 in the Tumbes-Progreso basin, in the 1970s-80s. The fields have production platforms and completed gas wells that have been confirmed by extended production tests.
PeruPetro approved BPZ as 100% owner and operator of Block Z-1, and consulting engineers certified reserves in the two fields. PeruPetro's approval is subject to government ratification due in the first quarter of 2005.
Corvina has 93 bcf of proved, 709 bcf probable, and 2,129 bcf possible reserves, and Piedra Redonda has 40 bcf of proved, 96 bcf probable, and 953 bcf possible reserves as of Jan. 1, 2005.
An outside inspection found the Corvina platform structurally sound for drilling and production. BPZ plans to refurbish the Corvina C-11X platform, in 200 ft of water, and rework its shut-in gas well in the second quarter of 2005. It expects the well to be capable of delivering a sustained 20 MMcfd.
Later stages
The Caleta La Cruz power plant has a substation and transmission lines capable of handling 300 Mw of electricity.
This provides the opportunity to add generating capacity as further gas production is added in Corvina and Piedra Redonda fields.
The probable reserves are delineated by drilling and electric log data from 7 wells, said Manolo Zuniga, BPZ president.
"Upon development of the probable reserves, the fields could easily supply a power generation project that would deliver 600 Mw during the 37-year remaining life of the Block Z-1 license contract," the company added.
"The possible reserves are untested but are principally located updip of the existing wells in the two fields. Accordingly, the drilling of one successful appraisal well in each field in an updip location could allow us to reclassify a significant portion of the possible reserves into the proved and probable categories," BPZ said.
Corvina field is about 40 miles south of Amistad gas field in the Gulf of Guayaquil, where Noble Energy Inc., Houston, has been supplying gas through a 40-mile subsea pipeline to a power plant at Machala, Ecuador, since September 2002.
