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Gazprom Neft almost halves production costs of Bazhenov oil

March 19/ 11:21

ST Petersburg. The Bazhenov Technology Centre (a Gazprom Neft subsidiary) has cut the costs of producing oil at the Bazhenov Formation, from RUB30,000 to RUB16,000 per tonne. A viable production cost, of RUB8,500 per tonne, is expected to be reached as soon as 2021.

Gazprom Neft’s 2019 year-end results show a 2.5-fold year-on-year increase in oil production at non-traditional reserves. Improvements in the technologies used in developing the Bazhenov Formation have allowed the company to almost halve the costs of producing Bazhenov oil, * from RUB30,000 per tonne at the start of the project in 2017, to RUB16,000 per tonne in 2019 — this figure itself reflecting a 20-percent reduction on 2018 levels.

Efficiency improvements in developing “hard-to-recover” oil have been achieved thanks to the development of innovative tools and the deployment of new approaches to developing the Bazhenov Formation. The Bazhenov Technology Centre has continued fine-tuning fracking technologies at unconventional reserves throughout 2019,** with the total number of stages achieved in high-tech fracking at the productive layer or “interval” at the Bazhenov Formation reaching 18 — the first such instance in the history of Russia’s oil industry. Added to which, the rate of fluid injection has also seen a three-fold increase, to 14 cubic metres per minute, with injection volumes increasing six-fold, to 2,000 cubic metres. The first domestic geophysical well-logging complex also successfully cleared pilot testing last year, as well as several new drilling fluids and supporting technologies for fracking. The company has also successfully tested a new type of xanthan-gum-based fracking fluid, the use of which has resulted in a 1.5-fold increase in well-flow.

The Bazhenov Technology Centre was responsible for drilling a 1,500-metre-plus horizontal well shaft at the Bazhenov interval without the use of rotary-controlled systems in 2019 — the first such instance in the history of Russian oil production, with a compound drilling tool being used specifically for that purpose, together with an oil-based drilling mud to reduce friction. Initiatives in fine-tuning drilling technologies have allowed the company to cut high-tech well construction lead-times by 13%, from 63 to 54 days.

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