Stuart takes stake in Oliver field in Timor Sea

Stuart Petroleum has acquired from the Albers Group a 50% stake in Oliver oil field in the Ashmore-Cartier region (AC/P33) of the Timor Sea.

Rick Wilkinson
OGJ Correspondent

MELBOURNE, Aug. 20 -- Adelaide-based Stuart Petroleum Ltd. has acquired from the Albers Group, Melbourne, a 50% stake in Oliver oil field in the Ashmore-Cartier region (AC/P33) of the Timor Sea. In exchange, Stuart will provide $85 million (Aus.) in work commitments.

Stuart will fund the drilling of the Oliver-2 appraisal well and will undertake all engineering studies up to a final investment decision on field development.

Oliver was discovered by BHP Petroleum in 1988, but deemed uneconomic at the time. The accumulation lies about 30 km north of Jabiru oil field and 700 km west of Darwin.

Stuart has contracted Songa Offshore ASA's Songa Venus semisubmersible rig to drill an appraisal well during second-half 2009. If the appraisal well shows commercial reserves, the subsequent development schedule calls for oil production to begin by yearend 2011.

The companies' current estimated recoverable oil and condensate for Oliver is put at 10-33 million bbl. Official Northern Territory Authorities' estimates are 21.4 million bbl of oil and condensates and 310 bcf of gas.

Stuart says the most likely approach would be a subsea development connected to a floating production, storage, and offloading vessel, which would probably include a liquids stripping operation with gas reinjection.

The Oliver-2 well and associated studies are expected to cost about $60 million. In addition, the sale agreement commits Stuart to fund the first $25 million of development expenditures.

Last year the Albers Group, which collectively held 100% interest, completed a new 3D seismic survey over the accumulation and reprocessed almost 3,000 sq km of the Onnia 3D survey shot some time earlier.

The aim was to investigate the potential for an increase in Oliver's down-dip oil potential to the northeast where a similar structure may be in communication with the deeper parts of the discovery.

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