Lundin Oil boosts production off Malaysia/Viet Nam

Swedish independent Lundin Oil AB and its partners are implementing a production enhancement project at their Bunga Kekwa field located in the PM3 offshore block in the commercial arrangement area between Malaysia and Viet Nam.

Oct 20th, 2000


Swedish independent Lundin Oil AB and its partners are implementing a production enhancement project at their Bunga Kekwa field located in the PM3 offshore block in the commercial arrangement area between Malaysia and Viet Nam.

The Bunga Kekwa field has been in production since July 1997. The partners have already reperforated two producing wells to boost field production to 15,000 b/d since Oct. 6, from 13,500 barrels b/d previously.

Design work is under way to boost production from existing wells and to drill two additional development wells during the first quarter of 2001. This program should result in an estimated sustainable production rate of 17,000 b/d, officials said.

They report work is proceeding on schedule for Phase II of the development project, which should increase production to 40,000 b/d of oil and condensate, and 250 MMcfd of natural gas after September 2003.

Basic engineering has been completed and tender invitations have been issued for the central processing platform and long-lead compressors and generators. As a result of optimization studies, officials said, capital costs associated with Phase II have been reduced by almost $100 million, or 16% of the original budget of $620 million.

Lundin Oil holds a 41.44% interest in Block PM3 through subsidiaries Lundin Malaysia AB and Lundin Malaysia Ltd., which serves as operator of that block. Partners include Petronas Carigali Sdn. Bhd., with 46.06% interest; and PetroViet Nam Exploration & Production, 12.5%.

Because of production increases and capital cost reductions, Lundin Oil decided to finance the project through internal resources and project debt rather than divesting a 15% working interest in the project as previously contemplated.

Lundin Oil currently nets production of more than 6,000 b/d from the PM3 block, which will increase to about 34,000 b/d when Phase II comes onstream.

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