AWE updates global offshore projects

AWE Ltd provided its 2Q 2014 production and development update.

Jul 31st, 2014

Offshore staff

SYDNEY, AUSTRALIA - AWE Ltd provided its 2Q 2014 production and development update. In southeast Australia, the BassGas project experienced a rise in production, up 69% over the previous corresponding year, with production in the June quarter primarily coming from the Yolla-4 well while Yolla-3 remained shut-in.

AWE and partners are considering accelerating the remaining phases of theMid-Life Enhancement project (MLE) by completing the lifts for the gas compression and condensate pumping modules over summer 2014/2015 prior to the commencement of development drilling. Scheduling of these activities is dependent on the timing of mobilizing Seadrill Ltd.’s WestTelestojackup, and is subject to finalization of the lift vessel charter agreement and FID.

For theCasino/Henry/Netherby project, gross quarterly production for the June quarter increased 10% over the March quarter. The production increase was largely due to the Henry-2 well coming back into production in April and the well did not experience significant downtime during the quarter. The joint venture defined a range of concept designs in April, for the next development phase of the project. A selected development concept that focuses on potential drilling opportunities and facility modifications is expected in early 2015.

Production from theTui oil fields, located offshore New Zealand, was down 14% in the June quarter, AWE reported, compared to the previous quarter. This decrease was largely due to a 10-day planned maintenance shutdown in June.

Drilling of thePateke-4H development took place, which reached a total MD of 4,772 m (15,652 ft) including a 749-m (2,457 ft) horizontal section through the producing reservoir. Pateke-4H was completed and suspended pending the installation of a subsea flowline and control equipment connecting the well to the Tui field gathering system. Field development work is scheduled to start in 1Q 2015.

AWE commented that the well experienced several challenges during the drilling phase which required two side track holes to be drilled. This resulted in estimated total drilling costs of $111 million, with AWE’s share totaling $64 million.

OffshoreIndonesia, AWE is working with partner Santos to interpret the K sand and G sand reservoirs of the Ande Ande Lumut oil project to optimize field development. Additionally, the JV is considering appraisal drilling of the deeper G sand during 2015 to evaluate its potential development.

Front-end engineering and design for the well head platform is nearing completion, with a revised FPSO tender plan submitted to the regulator. Once approved, the FPSO tender will commence in the second half of 2014. The FID is expected mid-2015, following completion of the FPSO tender projects, with first oil expected in late 2017.

07/31/2015

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