SYRIA - The Offshore Prospects.

In November 2003, the oil ministry gave Veritas DGC, a UK unit of Veritas of the US, a licence to survey a prospective 4,700 sq km area offshore. The contract called for seismic, geophysical and geological studies. Veritas was to share with Damascus the revenues from the sale of the data gathered.

InSeisTerra of Norway in early May 2005 began a seismic shoot off Syria after signing an exclusive 10-year agreement with SPC and the Ministry of Petroleum and Mineral Resources. The deal covers the acquisition, processing and interpretation of non-exclusive seismic data from areas off Syria. The shoot consisted of about 5,000 km of long-offset 2D seismic, covering the entire Syrian offshore sector and was to be "the only recognised official data set".

The agreement granted InSeisTerra the rights to conduct non-exclusive 2D and 3D seismic, as well as electro-magnetic seabed logging surveys. InSeisTerra was also given the right to handle the marketing and licencing of the geophysical data to the international petroleum industry. InSeismicTerra President Erik Hokholt was in March 2005 quoted as saying the official dataset "will become a very valuable tool for evaluating Syrian offshore acreage prior to the first offshore licencing round". The agreement includes the training of SPC personnel during the acquisition and processing phases.

The 2D survey will prepare the ground for Syria's first offshore licencing round, with an announcement of blocks on offer expected to take place in the summer of 2006. According to Jan Gateman, senior vice president of geology and geophysics at InSeisTerra, the offshore area contains a thick sedimentary column with a variety of play types such as large anti-clinal features, structural traps and stratigraphic plays.

Al-Furat Petroleum Co. (AFPC), operating the richest among Deir ez-Zor's blocks, is Syria's second biggest oil producer - having been the biggest oil producer in the country for many years. Al-Furat was set up in May 1985 as follows: SPC, 50%; Pecten Syria Petroleum (of Shell/Houston), 15.625%; Royal Dutch/Shell, 15.625%; and Deminex of Germany (18.75%). The Deminex stake was taken up by Veba Oil & Gas of Germany which in early 2002 was bought and absorbed by Petro-Canada.

Petro-Canada's stake was sold in late 2005 to a partnership of China's CNPC and ONGC of India - two state-owned companies which took up their equity in early 2006. The operator at AFPC is Shell, working on behalf of its Houston-based unit.

Shell since 1984 has made more than 90 oil and gas discoveries amounting to almost 2.4 bn barrels of oil equivalent, in the Deir ez-Zor (AFPC), al-Badiya (BOC) and al-Bishri (BPC) blocks (see Gas Market Trends). Most of these finds have been developed and hooked into AFPC's production stream. AFPC, BOC, and BPC have the same partners. Together they are now producing about 165,000 b/d - but their average is to fall in 2006 to 153,000 b/d, down from 350,000 b/d in March 1998, compared to a peak of 405,000 b/d in 1994. This is despite extensive EOR efforts since the 1990s.

AFPC's fields produce light/low sulphur oils from Lower Cretaceous sands of the Rutbah Fm, and to some extent from Euphrates and Jerribe limestones of the Miocene age, as in the case of al-Thayyem. The pre-Jurassic there appears to have limited prospectivity. Under a five-year programme started in early 1996 to manage the fall in oil production, the combined output of AFPC, BOC and BPC was set to decline by 10,000 b/d/year. Their production from more than 35 fields was targeted at 350,000 b/d for 2000. But this was reached in late 1997 as the decline was more rapid than Shell had expected. The following are AFPC's main fields:

Al-Thayyem, AFPC's first find in 1984 and one of its biggest fields, lies on the Euphrates River near the town of Deir ez-Zor. Syrian experts still claim its oil reserves in place are 1 bn barrels. Its installed capacity has been expanded to 100,000 b/d of 36.5[degrees] API oil, though its actual output has fallen since 1991 and now averages less than 15,000 b/d. The field reached its plateau in early 1991, when it was producing more than 82,000 b/d. Its permanent production and processing facilities began operating in September 1986. Its stream was tied to a central system at al-Ward field, together with other AFPC fields including al-Ahmar, Jido and al-Ashara. They were linked to a main export centre through a separate gathering system and pipeline, able to feed up to 100,000 b/d to the Homs and Banias refineries. A 92 km, 30-inch spur line was built to link the fields to the old IPC pipeline's T-2 pumping station. (The IPC pipeline, which linked Iraq's Kirkuk fields to Banias terminal, was nationalised by Damascus shortly after Baghdad took over the BP-led IPC in 1972). Another 70 km, 16-inch spur line was built from the al-Ward and al-Ashara fields to the T-2 station (see background in Vol. 58, No. 14)

The Omar/Omar North field, found in 1987, is larger than al-Thayyem. It was proven in March 1988 with 400m barrels of 40-41.5[degrees] API oils in place. The field was developed in a hurry and SPC, acting on orders from the political leadership, pressed Shell to raise its capacity to 120,000 b/d. Omar was inaugurated on Feb. 15, 1989, and production started at the rate of 55,000 b/d. Damascus, suffering from an acute shortage of foreign exchange, compelled Shell to raise production to 100,000 b/d by March 1, several months ahead of schedule and against Shell's advice. In April, reservoir pressure dropped and the field's output fell to 30,000 b/d. Later Shell established that the reservoir damage was extensive. A water injection system was built to bring output to less than half the design capacity before end-1991. Syria's sporadic rainfall pattern caused additional problems, with Turkey reducing the flow of Euphrates waters because of its massive new dams. High rainfall in the Turkish hills filled the Euphrates River with silt in the area where the system drew water.

The system, started up in early 1991, was shut down on March 26 after it operated during three days of high water levels in the Euphrates. Later it was established that the water for the scheme needed to be four times purer than mineral water.

Then Shell decided to drill wells beside the river to help take full advantage of seasonal flow peaks, with the river bed to act as a filter. Two more water injection systems were built. A fourth injection unit was awarded in August 1996 to Petrofac Int'l of the UK in a $92.8m contract and the work was completed in just 16 months.

Five 40 MW gas-fired power plants have been built at Omar since then, with an upgrade of related facilities completed in 2004. These supply electricity to AFPC and other companies operating in the Deir ez-Zor area.

Now Omar produces less than 10,000 b/d from natural pressure (compared to about 15,000 b/d in March 2000), and abut 20,000 b/d from pressure induced by water injection. For every two barrels of water injected, one barrel of oil is extracted.

Associated gas production and processing facilities at Omar, with a capacity of 4.3 MCM/day, started up in November 1991. Their capacity was expanded in 1995 to 6.5 MCM//day by PetroFac Int'l, under a contract signed in 1994, so that the Omar system can also handle associated gas from BOC's al-Izba field.

The Omar plant produces LPG, stabilised condensate and dry gas. The dry gas is being supplied by pipelines to the Tishreen power plant (south of Damascus), and the Mhardeh and the Jandar power stations near Homs.