AWE estimates the new well configuration planned for the Tui - Amokura - Pateke development will increase recoverable oil reserves from 26.8 million barrels to 27.9 million barrels (P50 basis).
AWE says that following its purchase of all the shares in former operator New Zealand Overseas Petroleum Ltd, the Sydney-based company has completed a detailed project review of the development.
The project review concluded that an optimized development plan could increase recoverable oil reserves.
Subject to regulatory approvals, this plan will reconfigure the oilfield development to include two wells on the Tui field (with a provision for a third well if development drilling and production data supports higher recoveries) and a single well on each of the Amokura and Pateke accumulations.
As part of the review process, AWE also investigated the implications of the revised development on capital expenditure and the date for first oil production.
The revised development plan did not necessarily adversely impact the previously announced capital costs of US$204 million. But AWE as operator, says it has advised the joint venture it is prudent to add an approximate US$21 million contingency to the approved project capital expenditure (i.e. a revised total capex of US$225 million) to allow for unforeseen future drilling problems or schedule delays associated with adverse weather conditions during the installation of the facilities.
The revised plan does not alter the timetable for first oil deliveries from the project, which are still expected by the end of the second quarter of 2007.
In addition to the development drilling, the joint venture will drill two exploration wells, Tieke-1 and Taranui-1, within PMP 38158. A drilling rig has been secured for these wells, which are currently scheduled for drilling in the second quarter of 2007.
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