Eight wells have been drilled to develop the field, and, as previously announced, damage to the platform rig sustained during Hurricane Ivan has delayed completion activities related to the four remaining wells. However, the timeframe for resuming completion activities has improved, with potential for continued field development to begin by year end. The financial impact of these delays is mitigated by business interruption insurance coverage held by Pioneer that is designed to restore the expected cash flow from the project after a waiting period that ended on November 1.
Pioneer holds a 25% working interest in the Devils Tower field, and Dominion Exploration & Production, Inc., a subsidiary of Dominion, operates the field with a 75% working interest. Devils Tower is located about 140 miles southeast of New Orleans on Mississippi Canyon block 773 in the deepwater Gulf of Mexico.
"With Devils Tower back on line, Pioneer's Gulf of Mexico production has returned to pre-hurricane levels. By the end of the year, we expect to add deepwater production from the fourth Devils Tower well, resume production from our deepwater Harrier field in the Falcon corridor and exit 2004 with total company production reaching record levels," stated Scott D. Sheffield, Pioneer's Chairman and CEO.
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