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In August 2003, CNPC signed a management rights transfer agreement for Block 11 with Petroecuador, In October 2003, CNPC acquired and took over Block 11, which is located in Sucumbios province in eastern Ecuador, and launched oil and gas exploration and development in this block.
Andes Project
In September 2005, CNPC and Sinopec jointly purchased oil and gas assets and development rights and interests of five blocks owned by Encana in Ecuador, and established Andes Petroleum Ecuador Ltd, with CNPC holding a 55% share.
In February 2006, Andes Petroleum took over the rights to explore and develop five blocks with a total area of 5,668 square kilometers in the east of the Oriente Basin. After the takeover, production and operation progressed smoothly. By enhancing reservoir analysis and management in mature oilfields, infilling adjustment wells, working-over production wells, and rationally arranging maintenance, we realized stable and slightly increased crude production.
In 2008, the Andes project maintained steady production. Horizontal well Fanny-18B-99H has achieved an average daily output of 1,000 barrels. In addition, we achieved a major success in testing Hormiguero Formation in Block 17.
In 2009, in order to curb production decline, the Andes cooperation project in Ecuador increased the application of advanced technologies and strengthened reservoir management, and achieved significant results, with the output of horizontal wells accounting for 40% of the total.
In 2010, Andes Petroleum converted its PSC into service contracts. We saw the successive birth of high-yield wells in the Tarapoa block, aided by the study of the patterns of reservoir-formation, fine reservoir description, and the distribution of remaining oil. When these new wells were put into production, the preliminary stage test results showed a remarkable average output of more than 900 barrels per day. We also introduced dual well completion and other state-of-the-art and proven oilfield production processes and technologies, and fulfilled the objective of stabilizing oil production.
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| | | | CNPC provides geophysical prospecting, drilling, logging and testing services in Ecuador. In 2006, we won seismic data acquisition and processing contract from PETROPRODUCCION. |
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| | | | The company attaches great importance to operation and environmental safety. No serious production or operational accidents have been reported in the three years since the takeover. The EHS indexes (RIS) increased from 0.69 in 2006 to 0.84 in 2007, establishing Andes Petroleum as an industry standard benchmark in Ecuador. The company is recognized by international organizations for its EHS-related efforts and achievements and is rated among the top three winners of the 2007 World Petroleum — Environmental Protection & Sustainable Development Award by the World Petroleum Organization.
New technologies are encouraged and promoted. The environmental impact resulting from land requisition and emissions has been minimized by applying horizontal drilling in old well sites, secondary extraction in high-energy reservoirs and short-route wastewater re-injection. These approaches and practices have been applauded by Petroecuador and the local industry.
The company conducts a range of programs specifically intended for the benefit of local people, based on an insightful understanding of the situation and needs of them. These outreach programs include the Andes Cocoa Garden, a mobile medical team and school buses. In addition, we promote the growth of the local economy by introducing planting techniques and giving financial support to public services, i.e. medical services, health and education. Meanwhile, an employment program has been initiated to create 750 jobs for surrounding communities. The purpose of this program is to achieve the safe and orderly long-term development of the company and its oilfields. According to local media, Andes Petroleum has been highly praised by Ecuador's Ministry of Internal Affairs, Ministry of Energy & Mines, and Petroecuador, as a good example of handling local affairs. According to people in the northern region, Andes Petroleum is the first foreign company in the history of Ecuador offering sincerity and friendship to local people.
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| | | | Nov. 2010 Andes Petroleum converted its PSC into service contracts.
Feb. 2006 Andes Petroleum took over the rights to explore and develop five blocks in the east of the Oriente Basin in Ecuador.
Sept. 13, 2005 CNPC and Sinopec jointly purchased oil and gas assets and development rights and interests of five blocks owned by Encana in Ecuador, and established Andes Petroleum Ecuador Ltd (Andes Petroleum), with CNPC holding a 55% share.
Aug. 29, 2003 CNPC signed a Petroleum Cooperation Agreement with the Energy and Mine Ministry of Ecuador and Petroecuador in Xi'an, Shaanxi Province. |
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