Crostella, Angelo, Hudbay Oil (Malacca Strait) Ltd., Indonesia

The Lalang and Mengkapan oil fields are located within the Malacca Strait production sharing contract area, Indonesia, some one hundred and eighty production sharing contract area, Indonesia, some one hundred and eighty kilometres west of Singapore.

Exploration of the 2.9 million acre area commenced in 1970, but the Lalang oil field was not discovered until 1980, following extensive seismic surveys and the drilling of eight dry holes. The discovery of the Mengkapan oil field followed in 1981.

In both fields the oil is reservoired within sands of the Sihapas Group of Early Miocene age. Geochemical data indicate that the shales interbedded within the Sihapas Group are the source rocks for the oil. Notwithstanding their young Late Tertiary age, these source rocks are mature for oil generation at a depth of burial of approximately 3,000 feet, due to the high regional geothermal gradient.

The trapping mechanism in both fields is controlled by the same regional north trending left lateral wrench fault. The Lalang accumulation occurs in an asymmetric anticlinal fold, bisected by the controlling wrench fault, and showing continuous growth since at least the Early Miocent. Both sections of the Lalang field have been tested; the oil/water contact is slightly shallower in the upthrown section. This appears to be a characteristic feature of the basin. The net oil pay penetrated by the Lalang - 2 discovery well on the western section of the structure is 153 feet and by the Lalang - 3 well on the eastern one is 316 feet. Cumulative flow rates obtained by drill stem testing were 7,092 bopd in the No. 2 well and 20,353 bopd in the No. 3 well.

The Mengkapan accumulation is contained in an elongated upthrown half anticline to the east of and paralleling the controlling wrench fault. Four discrete oil pools totaling 234 ft. of net pay were penetrated in the Mengkapan No. 1 discovery well. Cumulative flow rate from 6 drill stem tests was 12,017 bopd.

The discovery of the Lalang and Mengkapan oil fields opens a challenging new horizon to oil explorers, as the prolific Tertiary Central Sumatra Basin has now been proved to extend offshore from the island of Sumatra into the Malacca Strait.

Introduction

The Lalang and Mengkapan oil fields are located within the south-western part of the Malacca Strait Production Sharing Contract Area, Indonesia. part of the Malacca Strait Production Sharing Contract Area, Indonesia. The contract area extends over offshore and island acreage between the north-eastern coast of Sumatra and the boundary between Malaysia and Indonesia (Fig. 1). The two oil fields are approximately one hundred and eighty kilometres west of Singapore.

Geologically, the Malacca Strait area is located within the inner, north-eastern, part of the prolific back-arc Tertiary Central Sumatra Basin (Fig. 1). This basin accounts for half of Indonesia's current crude oil production, ranking among the basins with the highest amount of recoverable production, ranking among the basins with the highest amount of recoverable oil per acre/foot in the entire world.

EXPLORATION HISTORY

Exploration commenced in 1970, when Kondur entered into a production sharing contract covering the area, with Pertamina. Atlantic Richfield Indonesia Inc. (ARII) as operator, Pan Ocean (Marathon Oil Co.), Bridger (Home Oil Group) joined the original partners in the venture. Firstly, seismic surveys were carried out both offshore (In 1971, 1972 and 1974) and on the island (1972 and 1973), for a total of some 6200 kilometres. After obtaining a regional picture, several drillable prospects were delineated.

In their effort to evaluate the permit, the group drilled six dry holes (Fig. 2) during the period 1973–1975.

In 1979, Hudbay Oil (Malacca Strait) Ltd. (HOMSL) farmed into the acreage and became operator. HOMSL carried out a 700 km reconnaissance seismic survey in selected areas. Subsequently, three exploration wells were drilled in 1980. The first two wells proved to be dry, but the third, MS U-2, discovered the Lalang field. A detailed seismic survey of some 600 kilometres concentrated in the Selat Lalang channel ensued in 1980-81, which led to the location of three follow-up wells in the same area. The first, MS U-3, was a successful step-out to the Lalang discovery well; the second, MS B-2, eleven Kilometres to the north, was a dry wildcat, while the third, MS A-1, discovered the Mengkapan oil field, four kilometres to the south of the Lalang field.

STRATIGRAPHY

Main lithostratigraphic units encountered in the Lalang and Mengkapan area can be summarized from the lower-most unit upwards as follows.

Pematang Formation Pematang Formation The continental clastic deposits that inaugurated sedimentation in the area are referred to as the Pematang Formation, considered to be of Oligocene age on the basis of stratigraphic position. This formation is mainly comprised of fine to coarse quartz sands and conglomerates of continental aspect, occasionally interbedded with variegated, silty shales.

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