Statoil extends FPSO contract in Lufeng field in South China Sea

Statoil (Orient) Inc., a unit of Norway's Statoil ASA, has awarded Lufeng Development Co. ANS, a unit of the Netherlands-based Bluewater Energy Services BV, a production contract extension for Lufeng field in the South China Sea.

June 25, 2004

By OGJ editors

HOUSTON, June 25 -- Statoil (Orient) Inc., a unit of Norway's Statoil ASA, has awarded Lufeng Development Co. ANS, a unit of the Netherlands-based Bluewater Energy Services BV, a production contract extension for Lufeng field in the South China Sea.

The contract provides for the Munin floating production, storage, and offloading vessel to return to the Lufeng field early in second quarter 2005 for a minimum of 3 years.

The Munin FPSO is currently operating in Lufeng field until the summer. After undergoing minor modifications and maintenance, the vessel will be relocated to Xijiang field to produce for ConocoPhillips China Inc. for 5-6 months as a temporary replacement for the Nanhai Kai Tuo FPSO.

Munin will use its full dynamic positioning capability for mooring and will reuse Xijiang field's existing fluid transfer equipment, Bluewater said.

During the temporary relocation of the FPSO Munin, sidetrack drilling on three existing wells will take place in Lufeng field. This new drilling technology facilitates production of new pockets of oil, which should serve to extend the field's life, Bluewater said.