During the balance of 2005, ROC expects to drill up to 34 wells, 12 (35%) of which will be operated by the Company. With an anticipated net cost to ROC in the order of A$50 million this is a record level of drilling activity for the Company, both in terms of number of wells to be drilled and magnitude of investment. The program will span six countries and a range of different drilling environments from deep water offshore West Africa to onshore wells in the UK and New Zealand. Nineteen (56%) of the wells relate to oil field developments offshore Mauritania, in the UK North Sea and, subject to Final Investment Decision, offshore Western Australia.
This program effectively commenced on Saturday, February 12th when ROC, as operator of the Cliff Head Oil Field Development Project, received the ENSCO 56 jack-up drilling rig for tow to the Cliff Head-5 location where drilling is expected to start on/about 18 February 2005.
It is important to note that all drilling program forecasts are inevitably subject to change according to rig availability, logistics, government approvals and/or Joint Venture decisions.
The main points to note are:
ROC expects to participate in the drilling of a record 34 wells.
The total cost of the program, net to ROC, is expected to be in the order of A$50 million: a record investment by the Company.
Nineteen (56%) of the wells will relate to the development of the Chinguetti Oil Field, currently underway offshore Mauritania, the Ardmore Oil Field in the UK North Sea, which is also underway, and, subject to Final Investment Decision anticipated by early March 2005, the Cliff Head Oil Field, offshore Western Australia.
If the Chinguetti and Cliff Head development programs are completed on schedule it is expected that, within the next twelve months, ROC's production will increase from zero to about 8,000 BOPD. This is without reference to the Company's option over up to 26% of the Ardmore Oil Field in the North Sea which, subject to successful development drilling, could add a net 2,000 to 3,000 BOPD to ROC's entire 2005 and early 2006 production.
ROC will operate 12 (35%) of the wells.
Drilling activity will be spread between six countries and seven regions: onshore England; UK North Sea; West Africa, specifically deep water Mauritania and Equatorial Guinea; shallow waters offshore China and offshore Australia and onshore New Zealand.
Each of the 15 exploration/appraisal wells is expected to have the potential to add at least several million barrels to ROC's net proved and probable reserves - and some of those wells have the capacity to add a lot more.
Commenting on the 2005 drilling program, ROC's chief Executive Officer, Dr John Doran stated that:
"During the last couple of months the transactional side of ROC's activities has been in the ascendancy with the sale of the Saltfleetby Gas Field, the purchase of an option over the Ardmore Field in the UK North Sea and the placement of shares at a premium to market price. While ROC expects to continue to participate in other value-adding transactions during 2005, one of the other elements which will characterize the balance of the year will be a record level of drilling activity."