Pioneer Increases Assets
Pioneer Natural Resources Company announces the signing of a definitive purchase and sale agreement for the acquisition of working interests in 12 non-producing Gulf of Mexico blocks from a subsidiary of Baker Hughes Incorporated for approximately $23 million, subject to approval by the Board of Directors of Baker Hughes Incorporated.
The most significant property is a 33.3% interest in the Marathon-operated Camden Hills gas discovery in Mississippi Canyon 348. The Camden Hills field is being jointly developed with the Elf-operated Aconcagua and BP-operated King's Peak fields in the Canyon Express Project. Pioneer currently has a 25% working interest in the Aconcagua field. With the Camden Hills interest, Pioneer will own an 18% interest in the 500 mmcfd Canyon Express Project. First gas production is currently scheduled for the first quarter of 2002.
The acquisition also includes 6 shelf blocks and 5 other deepwater blocks. Working interest in the shelf blocks varies between 5% and 30%. Pioneer will have a 33.3% working interest in all of the deepwater blocks. Since the beginning of 2000, Pioneer has increased its number of deepwater blocks from 5 to 15 through federal lease sales and this acquisition. Four of the 15 deepwater blocks are Pioneer-operated.
Pioneer also increased its interest from approximately 16% to 20% in the Devils Tower oil discovery, located in Mississippi Canyon 773, by acquiring the interest of Westport Oil and Gas for approximately $6 million, effective September 1, 2000. The Devils Tower discovery well was drilled in late 1999 and an appraisal well and sidetrack have been drilled in 2000. Pioneer and other working interest owners, Dominion Exploration & Production, Inc. (60% and Operator) and Mariner Energy Inc. (20%), are currently evaluating development options. First production for Devils Tower is scheduled for 2003.
In Canada, Pioneer increased its interest to 100% in its Chinchaga gas field in northeast British Columbia by acquiring an additional 13% working interest from Triumph Energy Corporation for approximately $9 million, effective October 1, 2000. Pioneer expects to add approximately 1.5 million barrels oil equivalent (BOE) proved reserves and production of 475 BOE per day from this acquisition. As many as 70 extension and infill drilling locations are planned in the field during the next three drilling seasons.
Scott D. Sheffield, Chairman and CEO stated, "Acquiring these additional interests demonstrates Pioneer's strategy to seek opportunities to enhance our existing core areas. The significant production growth we expect from our deepwater Gulf of Mexico projects in 2002 and 2003 will be further enhanced by these transactions."
Pioneer is a large independent exploration and production oil and gas company in North America, with major operations in the United States, Canada, Argentina and South Africa. Pioneer's headquarters are in Dallas.