Global E&P Briefs

Statoil began drilling the first test well off the Faeroe Islands in mid-July with Transocean Sedco Forex's semisubmersible Sovereign Explorer.

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Europe

Statoil began drilling the first test well off the Faeroe Islands in mid-July with Trans-ocean Sedco Forex's semisubmersible Sovereign Explorer. The work follows the award of seven offshore exploration licenses in August of last year, following a licensing round launched in February. BP and the Faeroese Partnership, with Amerada Hess as operator, also have plans to drill off the Faeroe Islands this summer. - The Noble George Sauvageau jackup rig.

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The Noble George Sauvageau jackup rig.
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Statoil set a drilling record with a small discovery on Stine segment II on the Danish continental shelf 7 km east of Statoil's Siri Field. The drilling operation, carried out by the Noble George Sauvageau jackup rig, is Statoil's fastest ever exploration drilling resulting in a find.

Drilling, including coring and logging, was completed in less than 10 days. The well was drilled to 2,091 meters below sea level in 60 meters water depth.

New oil exploration is about to take place off Malta, where efforts over the past 50 years have failed to produce hydrocarbons in profitable quantities. TGS-Nopec compiled a new seismic data set of a 5,580 sq km area around Malta. The data have been made available to oil companies for planned new licensing. Hardman Resources NL, the only company with a license off Malta, reportedly seeks a partner to finance exploratory drilling southeast of the island.

PanCanadian Petroleum Ltd. claimed that its latest North Sea discovery off the coast of Scotland has the potential to be a world class oil development. The original test well results indicate significant potential for the Buzzard prospect, located 100 km northeast of Aberdeen. A new test well linked to the original well has established recoverable oil of 200-300 million bbl in that part of the Buzzard structure. PanCanadian is the largest stakeholder in the Buzzard project (45.01%), with the balance held by Intrepid Energy North Sea Ltd., BG Group, and Edinburgh Oil & Gas PLC.

Americas

Magnum Hunter Resources Inc. and its partners announced a new field natural gas discovery in the Gulf of Mexico. Eugene Island Block 302 No. 1 well was drilled to a measured depth of 10,694 ft in 225 ft water depth, 140 miles southwest of New Orleans. Following the construction and installation of a production facility, a second well will be drilled in an adjacent fault block. If the second well is successful, both wells will be brought on production starting in 2Q 2002. Magnum Hunter owns a 30% working interest in the discovery well and block, with operator Remington Oil and Gas Corp.(57.5%) and Wiser Oil and Gas (12.5%).

Noble Affiliates subsidiary EDC Ecuador Ltd. completed testing of the Amistad 7 well off Ecuador in the Gulf of Guayaquil Block 3. This well is part of a four-well work program on the block. Amistad 7 was drilled from a platform 30 miles offshore in 134 ft water depth. If current plans hold, a 40-mile pipeline will transport 13 bcf of gas from the field to a power generation facility near the city of Machala.

Petroleos de Venezuela SA (PDVSA), Venezuela's state-owned oil company, will begin drilling the first of 10 planned natural gas wells in the Delta platform of the Atlantic Ocean in October to determine the quantity of natural gas reserves there. The well is located close to Trinidad. The company plans to spend $250 million during the next three years on the exploration project, which could contain 20 tcf gas.

Central Asia

ExxonMobil Corp. plans to drill its first deep exploration well in the Cheleken Block 6 km off Turkmenistan in September. ExxonMobil holds (52.4%) of the Garashsyzlyk-2 concession, with state-owned Turkmenneft (20%) and Lasmo PLC (27.6%). Garashsyzlyk-2 is estimated to hold as much as 400 million metric tons of oil and 280 bcm of gas.

Middle East

BP Egypt said it has reached agreement to purchase TotalFinaElf's 50% interest in the West Mediterranean Deep Water Area Conces-sion in the Nile Delta. BP already operates the concession with 50% interest. The agreement was signed on June 19, but is subject to the approval of the Ministry of Petroleum. Plans are in place for the first well to be drilled later this year.

Africa

Sasol Ltd. subsidiary Sasol Petroleum Ltd. is in discussions with the Petroleum Agency of South Africa addressing gas exploration rights off the Western Cape province, just north of Saldanha. An exploration and production agreement would allow Sasol to acquire further geological and geophysical data and to conduct exploration drilling. Sasol expects to begin seismic surveying within 12 months and will determine an exploration drilling plan based on the results of the seismic data.

Equatorial Guinea is laying plans to negotiate a better deal for offshore oil rights with foreign firms after the creation of a state oil company. The country has already made some modifications to the initial production sharing contracts, which it believes were too favorable to foreign companies. It may push for a considerable increase in royalty percentages. So far, there is no time table for modifications to deals under the state oil firm, which has yet to begin functioning fully. An offshore oil boom has had a phenomenal economic impact. Current oil production is over 200,000 b/d.

Asia/Pacific

Petrovietnam is planning to build a $200 million pipeline to bring gas ashore from Block PM-3. The block is 375 miles southwest of Ho Chi Minh City. The plan is to start taking gas from the block to a power complex in the Ca Mau province in southern Vietnam beginning in 2005. Petrovietnam owns a 12.5% stake, while Malaysia's Petronas Carigali Sdn Bhd has 46.06%, and Sweden's Lundin Oil AB holds 41.44%.

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