Occidental Peruana Inc., a unit of Occidental Petroleum Corp., and Bridas Exploraciones y Produccion SA, Buenos Aires, have relinquished Peru's northern coast Lobitos, El Alto, and Los Organos oil fields to state petroleum agency Perupetro SA.
That puts more Peruvian upstream assets on the auction block.
Oxy-Bridas contract
The Oxy-Bridas contract had expired in July 1995 but was extended for another year as the government prepared to privatize units of Petroleos del Peru SA (Petroperu), the state oil company.
Oxy-Bridas, together with Canadian Occidental (Peruana) Ltd., had operated the fields since August 1978 when they signed an initial contract with Petroperu SA, which previously regulated oil contracts.
Petroperu has reincorporated the main fields into Block X, which it now operates under contract to Perupetro. According to the latest timetable, Petroperu's contract for Block X, together with the former Oxy-Bridas fields as Block XI, will go on the auction block in late October.
However, a couple of small fields, Cruz and Folche, producing about 200 b/d, have returned to their original status as part of neighboring Block VI operated since October 1995 by Sapet Development Co., a subsidiary of the China National Oil Co.
Project disappointing
One of the aims of the Oxy-Bridas project was to increase production to 45,000 b/d via waterflooding. But results were disappointing, and output peaked at an average 19,560 b/d in 1981 before falling steadily to 3,747 b/d last month.
Oxy Bridas since 1978 spent $462 million on the project and drilled 1,021 wells, mostly in the first 5 years.The contract was split 63% for Occidental Peruana Inc., 21% for Canadian Occidental (Peruana) Ltd., and 16% Bridas Exploraciones y Produccion SA.
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