Darkhoein 3rd Phase, West Karoun Investment Opportunity
Iran plans to raise its crude oil production by 1 mb/d from 11 oil fields in West Karoun area within four years. Darkhoein field is one of them with an envisaged contribution of more than 200,000 b/d.
Darkhoein is located in Khuzestan Province, 45 kilometers north of the city of Khorramshahr and 100 kilometers south of the city of Ahvaz. It is currently producing on average 160,000 b/d of crude oil. After development and the launch of its third phase, its output is expected to exceed 220,000 b/d.
Darkhoein is one of 49 oil fields introduced for investment by foreign companies under new model of oil contracts.
Discovered in 1964 following the drilling of an exploration well, Darkhoein is estimated to hold more than five billion barrels of oil in place, 1.3 billion barrels of which is recoverable.
The oil in Darkhoein field is light, with an API gravity of 39. The oil produced in Darkhoein is delivered to Ahvaz-Abadan oil pipeline.
According to estimates, $1.5 billion in investment would be needed in the third phase development of Darkhoein oil field. In this phase, two new reservoirs of this field – Ilam and Sarvak – as well as undeveloped Fahlian reservoir are to start operation. To that end, water and gas will be injected into Sarvak while gas will be injected into Fahlian.
Other activities pertaining to the development of Darkhoein include the drilling of 31 oil wells, 6 gas injection wells, and construction of surface facility for processing crude oil like stream pipelines, gas pressure booster stations, and infrastructure like crude oil storage facilities, repair posts and roads.
The first and the second phases of this field were developed by Italy's Eni under buyback contracts. The state-of-the-art technology for oil production and simultaneous injection of associated gas is being applied to the reservoir.
The contract for the third phase development was signed in August 2011 with an Iranian consortium. Eni refused to work in the third phase due to international sanctions against Iran. However, the Iranian consortium failed to handle the project and now it is among the projects offered for investment by international firms under new-style oil contracts.
In the first and second development phases of Darkhoein field, oil has been recovered from Fahlian formations. In the third phase development, in addition to Fahlian, oil will be also recovered from Ilam and Sarvak layers.
The first development phase of this oil field was launched in June 2005. For the second phase development of this field with an investment of around $1.3 billion, widespread demining operation was conducted on 7.5 square meters of land.
The second phase of Darkhoein development with a production capacity of 160,000 b/d of crude oil became operational in February 2010 with Eni's participation.
The third phase of development of the field was planned to come on-stream in five years. Now more than three years have passed since development operations began. But it is still far from full operation.
According to plans, in the first phase, 14,000 b/d of light crude oil and in the second phase, 46,000 b/d of heavy crude oil would be produced from Ilam and Sarvak layers.
The third phase of development of Darkhoein hinges upon heavy oil layers of Ilam and Sarvak as well as the undeveloped Fahlian layer. Eni was given the go-ahead to conduct feasibility studies, and the company has already submitted its findings.
These findings showed that it was possible to recover heavy crude from Ilam and Sarvak layers. It was agreed to start the third phase development after the end of the second phase.
Due to its heavy crude oil, this phase is totally different from the first and the second phases of Darkhoein development. Therefore, with a view to developing the third phase, negotiations with foreign companies and consortiums of Iranian and foreign companies were placed on the agenda.
According to initial forecasts, crude oil recovery from Fahlian, Ilam and Sarvak stands at 293 million barrels. In the first phase of development of this layer, 14,000 b/d of crude oil would start being produced 18 months after the project becomes operational.
The preliminary production from the second phase of development of Sarvak and Ilam layers would be 42,500 b/d of crude oil over 54 months after the contract takes effect. Twelve months later, production will reach 60,000 b/d.
The crude oil produced in Ilam and Sarvak reservoirs will be gathered in clusters before being transferred to new processing units which include separators, desalting units and stabilizer tower.