India's Committee of Secretaries has approved ONGC Videsh Ltd.'s (OVL) $228 million investment plan for the Nam Con Son gas development off Viet Nam. OVL is the international upstream arm of state-owned Oil & Natural Gas Corp. "ONGC has a 45% equity stake in the Viet Nam gas field project, which is presently at the construction stage," said OVL Managing Director Atul Chandra. "We propose to make the investment in two phases and will arrange the money either from our parent company or from the market." The project involves development of 2 tcf of gas reserves in Lan Tay and Lan Do fields on Block 06-1. OVL's partners are BP Amoco PLC and Statoil AS.
Kerr-McGee Corp. reported results of the first appraisal well drilled in its Gunnison oil find on Garden Banks Block 668 in the Gulf of Mexico. The 19,147-ft sidetrack, drilled in 3,150 ft of water about mile north of the discovery well, encountered a 1,800-ft gross oil column with 350 ft of net oil pay. Kerr-McGee estimates reserves to be 150-250 million bbl of oil, although several more appraisal wells will be drilled to evaluate the full potential of Gunnison, it said. The Gunnison subbasin includes Garden Banks Blocks 667, 668, and 669, all operated by Kerr-McGee Oil & Gas Corp., with a 50% interest. Partners in the blocks are CXY Energy Offshore Inc., a wholly owned subsidiary of Canadian Occidental Petroleum Ltd., 30%; and Cal Dive International Inc., 20%.
Operator Fletcher Challenge Ltd. said estimated reserves have doubled in the Pohokura gas-condensate field on permit PEP 38459 in the offshore Taranaki basin of New Zealand. The most recent well, Pohokura-2, has pushed field estimates up to 750 bcf of gas and 40 million bbl of condensate. The Pohokura-2 well's second drillstem test flowed at a maximum rate of 30.7 MMcfd through a 1-in. choke. Condensate flowed at 87 bbl/MMcfd of gas. Appraisal work is likely to continue later this year, comprising a 3D seismic survey to the north of Pokohura-2 and another appraisal well.
Russia's Gazprom has signed a $1 billion memorandum of understanding with Wintershall AG, a unit of BASF, to collaborate in developing Prirazlomnoye oil field in Russia's far north. Gazprom, primarily a gas concern, is gradually expanding its oil business. Currently, the gas giant produces 10 million tonnes/year of oil. This agreement will allow it to diversify its operations and lessen its dependence on gas. Prirazlomnoye holds an estimated 80 million tonnes of oil. Wintershall and Gazprom announced last week that they are planning to create a 50-50 joint venture to develop the field, which is expected to produce first oil by 2003.
Colony Pacific Explorations Ltd., Calgary, said it will pay $506,000 to participate in two natural gas development projects with the projects' partial owner, Imperial Metals Corp. Colony will pay a 25% share of the drilling, casing, and completion costs of four infill development wells to be drilled in the Medicine Hat area of Alberta. Colony will earn a 25% share of revenues until payout, after which Colony will retain a 5% share of revenues and Imperial will retain a 20% share of revenues. The second project is a workover of 16 existing wells located in the Sousa area of Alberta. Colony will pay a 4.9084% share of workover costs to earn a 4.9084% share of revenues until payout. After payout, Colony will retain a 1.2271% share of revenues, and Imperial will retain a 3.6813% share of revenues.