head office: madalena energy inc. suite 200, … gas world argentina 2014... · added others in the...
TRANSCRIPT
AUGUST 2014 1
How Can Western Canadian And International Experience Be Transposed
To Drive Success In Argentina?
Jeremías Guitarte Business Development Manager
Madalena e n e r g y inc.
Shale Gas World Argentina 2014
www.madalenaenergy.com
Head Office: MADALENA ENERGY INC. Suite 200, 707 - 7th Avenue SW Calgary, Alberta, Canada T2P 3H6
International Office: MADALENA ENERGY S.A. 421 Lola Mora, 13th Floor C1107DDA, Buenos Aires, Argentina
NOT FOR DISSEMINATION
AUGUST 2014 2
Introduction to Madalena: • Our operations in the Western Canadian Basin and in the
Neuquén Basin • The integration with Gran Tierra Argentina
Lessons learned from international operations
Operations and results in Canada and Argentina. The way forward in the Neuquén Basin
What is Madalena’s strategy for continuous growth?
Agenda
AUGUST 2014 3
Madalena Energy • Madalena can be considered a relatively small-
size company that is however: – Operating in Canada and Argentina over a big
acreage About 100,000 net acres in Canada More than 135,000 net acres in Neuquén Province
AUGUST 2014 4
Madalena Energy • Recently acquired Gran Tierra Argentina’s assets:
– Incremented its assets in the Neuquén Basin and added others in the Northwest Basin
About 205,000 net acres in the Neuquén Basin More than 752,000 net acres in the Northwest Basin
Mendoza La Pampa
Rio Negro
Neuquén
Curamhuele
Cortadera
Coirón Amargo
Puesto Morales
Puesto Morales
Este
Rinconada
Vaca Mahuida
Salta
Jujuy Formosa
Santa Victoria
Valle Morado
El Vinalar
Balbuena Este (Palmar Largo)
Surubí
Palmar Largo
El Chivil
Bolivia
Paraguay
AUGUST 2014 5
A balanced and strategic approach – ~4,900 Boe/d (72% oil) Pro Forma on closing – Expected growth to 5,500 – 6,000 Boe/d in 12 - 18 months in addition to
continued delineation & prove-up of shale assets – Stable production platform which generates cash flow for reinvestment into
conventional development and unconventional shale delineation and prove-up
– Inventory of locations for high-impact horizontal oil development – 3 Key Blocks: Coiron Amargo, Puesto Morales and Surubi – Palmar Largo, Sierras Blancas (Tordillo) and Lomo Montosa formations – Inventory of production focused workovers and conventional vertical drilling – Unbooked upside via enhanced oil recovery (EOR) / waterflood programs
– Unconventional Exposure to: Vaca Muerta shale, Lower Agrio shale, Mulichinco tight sands, Los Monos shale
– 6 Key Blocks: Coiron Amargo, Curamhuele, Cortadera, Santa Victoria, Puesto Morales and Rinconada
– Exploration & Appraisal upside on all 14 blocks – 20+ conventional prospects / leads identified
Solid Production Base
Exploration & Appraisal
Upside
Conventional
Development Inventory to
Grow Production & Reserves
Delineation of Unconventional Shale & Tight Sand Resources
AUGUST 2014 6
• Definition of the completion technology to be used – the target/goal to be achieved
• Trial and error, in the first wells, of main variables that could impact operational and economic results
• Standardization of operations and cost reduction
The learning process
AUGUST 2014 7
• In a single operation, the production liner is run in hole together with liner packers for open-hole, that divide the well in multiple sections, isolating each one of them.
• Afterwards, the sliding sleeves that are located in-between the packers are opened sequentially and the frac fluids/proppants are pumped through, stimulating the zones of interest.
The learning process The technology used in Canada and Argentina
AUGUST 2014 8
• In a single operation, in a period of less than 20 hs, MVN performed up to 14 frac-stages. The system can speed up conventional fractures that would take 4-5 days in just 1 day.
• The cost reduction is mainly due to rig time reduction. • This technology can be use in both horizontal and vertical wells. • The technology can be use for sandstones, limestones and shale,
indistinctly.
The learning process The technology used in Canada and Argentina
AUGUST 2014 9
• There is a long learning curve on the road to an economic horizontal multi-frac project.
• The key is to begin by understanding the rocks and then, as quickly as possible, determine the limitations that the rocks are going to put on the frac operation.
• The goal is to efficiently converge on an economic and effective frac program and then implement it and ultimately fine-tune it over time.
• Transferring our international experience to Argentina rocks is not solely about equipment and technology, but it is also about implementing the learning process described before.
The learning process Conclusions
AUGUST 2014 10
Operations and results in Canada
– In the Western Canadian Basin, in the Greater Paddle River Area, MVN drilled 8 horizontal wells, all of them completed with multi-stage fracs, which allowed MVN to significantly increase production
– The lateral sections of the wells ranged 1000 to 1200 m, and the TD varied between 1500 and 2000 m.
– Each lateral section has been fractured in 10 to 14 stages.
AUGUST 2014 11
Operations and results in Argentina
– In Puesto Morales, GT Argentina drilled its first horizontal well in Loma Montosa formation in 2012 to prove a new development concept different from the ones used until that moment for those low-permeability dolomites. The well was fractured with the multi-stage system and demonstrated the economic feasibility of the new concept.
– The well TD was 1500 m with a horizontal section of 500 m.
– The well initial production was equivalent to 5 vertical wells and its stabilized production rate is similar to 5-8 vertical wells.
AUGUST 2014 12
– The horizontal section was fractured in 5 stages and currently MVN is evaluating the benefits of extending the section and the increase of stages.
– This completion technology is the same used in Greater Paddle River Area.
Operations and results in Argentina
AUGUST 2014 13
The way forward
• Multi-well horizontal program being executed in Paddle River in 2014/2015 (target Ostracod oil)
• Multi-well horizontal multi-stage frac program in Puesto Morales in 2015 (target Loma Montosa resource play - oil)
• First horizontal well (multi-stage frac) in Coirón Amargo in 2015 (target Vaca Muerta shale)
AUGUST 2014 14
MVN’s strategy for continuous growth
Short term
• Development of high impact horizontal resource plays and low-permeability reservoirs by applying the proven North American based technology and gaining experience from the learning process
• Delineation and prove-up of its unconventional shale assets in the Vaca Muerta shale and Agrio shale
Medium term
• Enter/integrate the unconventional resources know-how and industry learnings to Madalena execution
• Unlock value from Madalena’s unconventional resources in the Neuquén Basin
AUGUST 2014 15
MVN’s strategy for continuous growth
HHRR
Flat organization with great “fast decision making” capability
Experienced and motivated professionals
Portfolio
Balanced portfolio of conventional and
unconventional projects
Look for synergy between assets
Projects with easy market accessibility
Increase assets value through lessons learned
Business Development
JV with strategic partners