Oxy adds California gas-condensate giant

Oxy adds California gas-condensate giant

By OGJ editors
HOUSTON, July 23 -- Occidental Petroleum Corp. has drilled six wells in an apparent giant gas-condensate field in California’s San Joaquin basin that has an estimated 150-250 million boe recoverable.

The discovery identified a new play concept that Oxy officials compared with an offshore deepwater structure. They said the concept is prospective underneath Oxy’s giant Elk Hills field southwest of Bakersfield and indicated it may be exploitable by other operators in the basin.

Meanwhile, Oxy said it has hiked Elk Hills reserves to more than 491 million boe from 425 million boe when the company bought the field from the US government in 1998. Elk Hills has produced more than 364 million boe in the interim.

Geological extent of the 2009 multizone, mostly conventional discovery in Kern County is still <. Oxy didn’t give the find’s locale in sprawling Kern County. It said the hydrocarbons are two-thirds gas. Oxy’s working interest is 80%.

The size of the find will require Oxy to expand its 400 MMcfd Elk Hills gas processing plant.

The discovery could be California’s largest in more than 35 years, Oxy said. The company said it is probable that more reserves exist outside the area so far defined and that similar structures lie beyond its 1.1 million net acre position in California. Oxy plans to drill wells to exploit the other opportunities in the next 5-10 years.

Oxy said it has drilled 34 exploration wells in the past year or more seeking nontraditional targets on its California acreage.

Oxy, as California’s largest gas producer, third-largest oil producer, and largest acreage holder, operates more than 7,500 active wells in 90 fields in the state. The company’s proved reserves in California at the end of 2008 were 708 million boe, about 24% of its worldwide reserves.