First oil from Oyong

Santos Ltd. has begun production from the Oyong field in the Sampang production-sharing contract (PSC), 70 km (43.5 mi) east of Surabaya, Indonesia.

Offshore staff

ADELAIDE, Australia -- Santos Ltd. has begun production from the Oyong field in the Sampang production-sharing contract (PSC), 70 km (43.5 mi) east of Surabaya, Indonesia.

Gross oil production rates are expected to stabilize between 8,000 and 10,000 b/d under Phase I development, Santos says.

Five wells produce oil through a wellhead platform. Gas, which is to be reinjected, is produced from two wells. Oil processing is being taking place on a production barge, theSea Good 101. Processed oil is then piped to the Shanghai FSO for storage and offtake.

Front-end engineering and design for the Oyong Phase II gas project is under way, with first production anticipated in the first half of 2009. A final investment decision for Phase II is expected before year-end.

The Wortel gas field, which was discovered in 2006, is approximately 7 km (4 mi) west of Oyong and could potentially be incorporated into the gas development, subject to further appraisal, which is planned for first half of 2008.

Santos operates the Sampang PSC with 45% interest. Its partners are Singapore Petroleum Sampang Ltd. with 40% interest and Cue Sampang Pty. Ltd. with 15% interest.

"First oil production from Oyong is an important milestone for Santos as it adds another operated project to our Asian portfolio," says Santos Managing Director, John Ellice-Flint.

Oyong was discovered in 2001 in 45 m (148 ft) water depth.

9/24/2007

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