Don Development Update

RNS Number : 1413X

Petrofac Limited

10 August 2009

 



PETROFAC LIMITED

DON DEVELOPMENT UPDATE

Petrofac, the international oil & gas facilities service provider, is pleased to provide the following update on the status of the Don Development, of which it is the Operator. The development consists of subsea wells located in the West Don and Don Southwest (Don SW) fields, tied-back to the floating production facility (FPF), the Northern Producer.

West Don Field (Petrofac 27.7%)

The drilling and tie-back operations of two production wells and one water injection well have been completed successfully. One production well has been on-stream since 28 April and has recently been producing at gross rates of around 6,000 barrels per day (bpd) without gas lift. Production from the second well commenced on Friday 7 August. Water injection is expected to start-up within the next few days.

Don Southwest Field (Petrofac 60.0%)

The drilling operations of two production wells and two water injection wells have been completed successfully. Both production wells have also been tied-back. One production well has been on-stream since 1 July and has stabilised at gross production rates of approximately 12,000 to 14,000 bpd over the last month. The second production well has been tied-in, however a further intervention is required to remove a suspected completion blockage prior to bringing it on-stream. The two water injection wells will be tied-back during October. Water injection is expected to start shortly thereafter.

During the drilling of the Don SW water injection wells, Petrofac took advantage of drilling two cost-effective pilot holes into adjacent reservoir structures, both of which discovered oil. One of the pilot holes was drilled into an area known as the "Horst", a structural high between Areas 5 and 6. This area has excellent reservoir quality with high oil saturations and development of the Horst is now likely to take precedence over Area 6. The discovery of the Horst along with the recently discovered 'H' Panel are expected to be exploited during further stages of development of the field. 

Performance and Outlook

Oil export is currently being performed through the use of shuttle tankers, which connect to an offshore loading system. Two tanker cargoes have so far been sold, with just over 1 million barrels of oil having been produced to date from the combined fields. This mode of oil export is expected to continue until early 2010, when a permanent oil export route will become available over the Thistle platform.

Full commissioning of the Northern Producer FPF is nearing completion. As the plant has stabilised, oil production has recently climbed to approximately 20,000 bpd, consisting of the combined output from one well on each field. 

Petrofac now expects that gross oil production this year will amount to between 3 million and 5 million barrels. The range in this estimate accounts for potential weather-related interruption to remaining well tie-back activities and offshore tanker-loading, which could be quite significant during the winter months.

Petrofac expects to provide further guidance as to the performance of the Don Development during the fourth quarter of 2009, once all production and water injection wells are on-stream, and their performance can be properly assimilated.

Ends

For further information contact:

Petrofac Limited Ayman Asfari, Group Chief Executive Keith Roberts, Chief Financial Officer Jonathan Low, Head of Investor Relations	[phone]
Bell Pottinger Corporate & Financial Ann-marie Wilkinson Olly Scott	[phone]

Notes to Editors

West Don

West Don is located in the northern North Sea, approximately 150 km northeast of the Shetland Islands and 12 km north of the Thistle field in a water depth of approximately 500ft.  

The Northern Producer floating production facility, which recently finished an assignment on the Galley field, will be utilised for processing fluids from both fields ahead of export. It has been secured for field life under a lease arrangement, with lease cost based on an oil throughput tariff dependent on Brent oil prices.

Oil export from the Northern Producer will take place initially via offshore tanker, switching to pipeline export via a subsea tie-back to existing infrastructure in due course.  

Petrofac Energy Developments assumed operatorship of West Don after purchasing a 40% equity interest in Block 211/18a (West Don Area) from former co-owners BP and Conoco in February 2006. The West Don field straddles Blocks 211/13b and 211/18a (West Don Area) (licences P.1200 and P.236 respectively). Owners of the two blocks agreed a fixed field unitisation, which resulted in Petrofac owning 27.7% of the West Don unit.

Owner    Equity %	211/18 (P.236)	211/13b (P.1200)	Unit Area
Petrofac	43.12		27.700
First Oil	30.00		19.275
Valiant Petroleum	26.88		17.275
Nippon Oil		50.00	18.500
Stratic Energy		50.00	17.250

The West Don field was discovered in 1975 by well 211/18-9 that contained oil in sandstones of the Middle Jurassic Brent Group. The West Don reservoir comprises circa 470ft thick Brent sandstones. The under-saturated oil is held in an elongate easterly dipping, fault bounded reservoir at a depth of greater than 10,600ft.

Don SW

Petrofac Energy Developments assumed operatorship of Don SW after purchasing interests from former co-owners BP and Conoco in December 2006. Petrofac as operator holds 60% equity in licence P.236 (Block 211/18a-Don Southwest Area) with the sole partner Valiant North Sea Limited holding 40%.  

Don SW is an oil field comprising 450ft thick Brent sequence sandstones, as producing in the nearby Thistle and South Magnus fields. The under-saturated oil is held in a combination of dip and fault traps at a depth of 11,000 to 11,500ft. 

Petrofac

Petrofac is a leading international provider of facilities solutions to the oil & gas production and processing industry, with a diverse customer portfolio including many of the world's leading integrated, independent and national oil & gas companies. Petrofac is quoted on the London Stock Exchange (symbol: PFC) and is a constituent of the FTSE 100 Index.  

The group delivers services through seven business units: Engineering & Construction, Engineering & Construction Ventures, Engineering Services, Offshore Engineering & Operations, Training, Production Solutions and Energy Developments.

Through these businesses Petrofac designs and builds oil & gas facilities; operates, maintains and manages facilities and trains personnel; enhances production; and, where it can leverage its service capability, develops and co-invests in upstream and infrastructure projects. Petrofac's range of services meets its customers' needs across the full life cycle of oil & gas assets.

With more than 11,000 employees, Petrofac operates out of five strategically located operational centres, in Aberdeen, Sharjah, Woking, Chennai and Mumbai and a further 19 offices worldwide. The predominant focus of Petrofac's business is on the UK Continental Shelf (UKCS), the Middle East and Africa, the Commonwealth of Independent States (CIS) and the Asia Pacific region.

For additional information, please refer to the Petrofac website at www.petrofac.com.

 

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