Volodymyr Maksymov: It is worth saying that there is no need to increase production at any cost

Volodymyr Maksymov: It is worth saying that there is no need to increase production at any cost

EXPRO talked about important role of geological assessment, state of natural reserves, projections on oil and gas production, experience and geological fortune of Volodymyr Maksymov, Director of the Geological Department of Poltava Petroleum Company JV.

- How did you start your career?

- I stem from Poltava region. I studied at the Ivano-Frankivsk University of Oil and Gas, and graduated it in 1984. At that times, many of our graduates were sent to work in Russia, to the North of it. However, I stayed in Ukraine, got to work at Ukrgeofizika enterprise, where I acquired experience both as a geologist and as a specialist in seismic exploration. Then I worked in the gas industry department of Poltavagasvydobuvannya [branch of UkrGasVydobuvannya - Ed. EXPRO]. From 2007 to 2015, I worked in Poltava Petroleum Company Joint Venture. Then, in 2008-2009, there was a drilling boom in Poltava Petroleum Company JV. Sometime in 2011, there was the peak of hydrocarbon production in Ukraine. In order to simulate hydrocarbon production, both acid treatments and hydro-fractures were used: in 2010, a well with a horizontal leg was drilled at Rudenkovskoye gas field, and in 2005, a 10-stage hydraulic fracture of the formation was carried out to enhance production of hydrocarbons. Such a multi-stage fracture was the first in its kind, and ever done in Ukraine. As the result of the fracturing, we got a 2- to 3-fold inflow of hydrocarbons, and the well has been still producing. In 2015, I had the opportunity to work abroad, I agreed to that proposal.

- What foreign projects did you take part in? What were you doing there?

- In 2015, I received an invitation from the Ukrainian company "Yug Naftogaz". The company had a project in Turkmenistan, where they contracted 3D seismic survey and well casing job. There was also a project in Tunisia, where we did 2D seismic surveys. I must say that in recent years it has become much more difficult to work in Turkmenistan. Among other things, there were strict requirements for involvement of local staff into projects. But, of course, I got an invaluable experience.

-When did you come back Poltava Petroleum Company JV?

- That was in 2017. I was invited back to Poltava Petroleum Company (PPC). In addition, Viktor Volodymyrovych [Mr. Gladun, CEO of PPC – Ed.] invited me to handle geology in Poltava, where I had worked for many years not only in the private sector, but also got multi-year experience in PoltavaGasVydobuvannya state-owned company.

- What are the PPC's assets in terms of geology? What are the prospects for production?

- The main asset of the company is Novomykolayev complex of gas fields: Novomykolayivske, Ignativske, Movchanivske, Rudenkivske gas fields, which have been explored and developed since 70-80-ies. However, detailed 3D seismic survey of 150 square kilometers was made only in 1998, and that was the first one in Ukraine’s history. For that time, it was a rather expensive project. The data obtained radically changed the understanding of the deposit geology, enabled precise drilling of dozens of wells, which further on yielded a significant production of oil and gas. Though, one needs to understand that 3D is not a "panacea". Even having the most expensive and advanced research data, there is not any guarantee that drilling results will be 100% successful. The real challenge for the company is the development of Rudenkivske gas field. The program for the hydro-fracturing in 2017 did not brought any results. Over the past year, we did recovery of some wells. Our plans are to go further on with sidetracking. We are currently considering the use of technology for extracting hydrocarbons, for example, plunger lifting.

-Today there is a lot of talk about huge gas reserves in Ukraine, that they should be developed proactively. How do you assess the hydrocarbon reserves in Ukraine and the prospects for increasing production?

- Geology is a very conservative science, therefore, I am cautious about the assumption that Ukraine is the second in Europe for natural gas reserves. The fact is that to be 100% sure, one needs to do explorative drilling to check the data. Drilling results can fundamentally change previous expectations as to the prospects of gas field areas and formations. There have been enough of such experiences. The PPC also has an interesting experience: the already mentioned Rudinske formation. Although preliminary estimates of the formation were viewed as extremely high, the exploratory drilling considerably reduced the expectations of easy production, since it is difficult to extract these reserves today due to the complex geological structure of the formation.

- That is, are the gas reserves of Ukraine overestimated?

- In recent years, I have not heard about any discovery of a new large- or even medium-sized deposits in Ukraine. Almost all companies are working on the "old" gas fields. Almost all production growth is due to the latters. In general, one must admit the fact that today there are no such large discoveries in the Donets-Dnipro depression. Companies will have to work with small and tiny deposits. And, this requires the introduction of the latest technologies and best practices. PPC, as well as UkrGasVydobuvannya, works in fields, which are depleted by almost 70-80%. Under such conditions, only systemic and meticulous planning can bring results, as proved both by time and experience of PPC.

- How realistic is the 20/20 Program of UkrGasVydobuvannya?

- I’d rather not evaluate the 20/20 program. However, it is worth saying that there is no need to increase production at any cost. The program of actions should be flexible to enable the developments of deposits more efficiently. Drill, evaluate the results, make adjustments, and work on further. Flexibility in decision-making with regard to particular conditions is an important element in the efficiency of gas production.

-Last year, the PPC resumed drilling after the recess since 2014. Almost imediately there were noticeable results, gas production rose sharply. Could you tell us what was done?

-First of all, the production growth was due to the drilling of a new Well №308 at Elizavetovskoye gas field in addition to the successful sidetracking in Well №103 at Ignatovskoye gas field. The contractor in both cases was Spetsmekshervis drilling company. We’ve chosen this company based on several parameters, although there is a question about their speed of drilling. Yet, progress is noticeable, and by joint efforts we are able to fulfill our tasks. In addition, in December 2018, we started drilling of another new well in West-Mashivska gas field.

-There were first electronic auctions, and they sold 3 out of 10 E&P permits for gas fields . Why didn’t PPC participate in them?

-Currently, we are closely monitoring the process, and do welcome the initiatives of transparent auctions for all investors. We’ve studied in detail the proposed gas fields. For sure, we will take part in competitions in future. Regarding this, I want to add that to attract investors for development of gas fields, in particular foreign ones, it is necessary to provide a more detailed information about geology. The quality of geological information accompanying every bid should be better. Important is the fact that they have initiated transparent procedures for obtaining permits. For our company, which has been adhering to international standards of business over the last 25 years, this move evidences positive changes in the Country’s oil and gas industry.