WATCHING THE WORLD SUCCESS IN YEMEN

Yemen's position as the hottest exploration play on the Arabian Peninsula has been confirmed by a drilling campaign run by CanadianOxy Offshore International Ltd.

The Calgary company, in partnership with Lebanese owned Consolidated Contractors International Co. SAL and Shell Oil Co.'s Pecten Yemen Co. apparently has found a commercial oil producing area on its Block 14 in the eastern part of the country (OGJ, July 15, p. 34).

CANADIANOXY'S ROLE

Interest among the expatriate exploration community in Yemen was drawn to the region when CanadianOxy drilled two successful wells on the Camaal structure earlier this year following two other drilling successes on separate structures.

Interest was heightened by Canadianoxy's decision to bring in two more rigs to work on the block starting next month, along with two seismic crews to give exploration capacity in this remote part of the world a considerable boost.

By the end of this year CanadianOxy, a 60% shareholder in the group, plans to have completed a further five wells. The first followup well, 3 Camaal, is about to be spudded.

That's the kind of drilling commitment that adds up to a commercial discovery, although the operator says it still needs to do more formation testing.

However, the Yemeni government certainly thinks the group has uncovered a new producing area. When Yemeni Oil Minister Salih Abu Bakr Husainoun visited drilling operations on the permit he disclosed that CanadianOxy teams will shortly begin a survey for an export pipeline from Block 14 to a terminal on the Gulf of Aden coast.

The minister also whetted local appetites by revealing that CanadianOxy's drilling program will include four other locations on the 36,000 sq km tract.

Until now, most exploration attention was centered around the two established producing areas west of the new discoveries.

Yemen Hunt set the Yemeni play rolling with its Marib al Jawf discoveries in former North Yemen.

The amalgamation of the two countries was followed by allocation of acreage around the Shabwa area of former South Yemen, where Technoexport of the Soviet Union is developing a series of fields.

Emergence of a single Yemen also facilitated exploration in the disputed zone between the two countries. Next month a Hunt-Exxon led group will drill the first wildcat on Block 5 between the Marib and Shabwa producing areas.

BRITISH INDEPENDENTS

The CanadianOxy finds have turned the spotlight on two British independents that have just signed letters of understanding for production sharing contracts on acreage immediately north of Block 14.

Clyde Petroleum plc, Herefordshire, U.K., has taken a 7,000 sq km tract in the western part of a block that was relinquished by a group led by Brazil's Braspetro in partnership with Repsol SA of Spain and BP Exploration. The Clyde acreage has been named West Hooaarin and redesignated Block 32.

The second letter of understanding was signed by Lasmo plc, London, and covers about 6,300 acres in the eastern part of the old Braspetro permit. Both letters of understanding are to be turned into production sharing agreements during the next few months.