These portfolio additions of undeveloped oil and natural gas discoveries enhance Marathon's efforts to establish a new core area in Norway. Both blocks are close to the company's existing infrastructure positions in the Heimdal and Brae areas of the Central North Sea, which will allow Marathon to utilize existing and proposed pipelines and processing infrastructure in the development of these and other fields.
This marks Marathon's fifth acquisition in this area of the Norwegian shelf during the past year, including the recent State Direct Financial Interest (SDFI) transaction with the Norwegian Government. In total, all Norwegian production licenses currently held by Marathon are estimated to contain net risked resources of approximately 135 million barrels of oil equivalent, including both discovered fields and similar but undrilled prospects nearby.
"Completing these acquisitions and becoming operator of PL 203 are significant milestones for Marathon in Norway," said Marathon senior vice president, Commercialization and Development, Dave Golder. "Marathon's satellite field development experience gives us confidence that we can develop these reserves in a cost effective and timely manner." Currently, Marathon is reviewing joint development scenarios, which would build upon existing infrastructure to develop these resources to meet the energy needs of European markets. First production is expected in 2005.
The Marathon-operated PL 203 block, in which the company has a 65-percent interest, is located to the west of Heimdal and includes the Kameleon oil/gas and Gekko gas discoveries. The adjacent license PL 150, in which the company has a 50-percent interest, is located southwest of the Heimdal field close to the UK border and includes the Greig oil discovery. Marathon now has interests in Norwegian PL 025, 036, 088, 102, 150, 187, 203, 204 and 249.
During the past year Marathon has established a new office in Stavanger, Norway, and has announced plans to lead the development of the Symphony Natural Gas Pipeline system. This pipeline will be designed to transport additional supplies of natural gas from the UK and Norwegian North Sea to the Bacton Terminal in southern England. The proposed pipeline represents a step forward in assuring adequate natural gas supply for the UK market over the next 20 years, during which demand for this clean, efficient energy source is expected to grow substantially.
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