3D Oil Limited has provided an update to shareholders outlining its recent development progress and the company's plans to maximize the value of its assets for shareholders.
Recent Development Progress
Over the past six months, the 3D Oil team has made significant progress in bringing the attractive West Seahorse project, located in the Gippsland Basin, to development: 3D Oil has undertaken in-depth assessments of various infrastructure options for the development of West Seahorse. These options have included:
3D Oil's detailed option review included an assessment of capital requirements; environmental impacts; necessary regulatory and other approvals; development lead times; onshore infrastructure; alignment options; and project economics.
The analysis has resulted in the MOPU option being the favoured development option.
Consequently, at the commencement of the year, 3D Oil completed a pre-FEED1 with WorleyParsons for the development of West Seahorse utilizing a MOPU, with oil exported to an onshore tank. The scope of WorleyParsons review included:
The base case considered by the WorleyParsons' study included:
Subsequently, a commercial and technical proposal for the supply of a MOPU and top side fit-out was commissioned. Global Process Systems, a company which has significant experience in the supply and operation of MOPUs throughout Asia and the Middle East, provided an indicative costing as part of this analysis.
In parallel to these initiatives, 3D Oil has undertaken an extensive subsurface study of West Seahorse incorporating newly acquired well data (including oil and reservoir samples), 3D seismic mapping, HDVA2 depth conversion, detailed petrophysics, detailed production simulation and production calibration to the neighbouring Seahorse field. 3D Oil was assisted by several industry experts in this analysis, including Dr. Rodney Halyburton and Dr. Andrew Wadsley.
On March 12, 2009, 3D Oil announced an increase to its reserves and contingent resources at West Seahorse, increasing 1P reserves by 32% to 4.1 mmstb and increasing combined 2P reserves and contingent resources (P50) by 11% to 8.7 mmstb. This significant increase in reserves is expected to assist 3D Oil's ability to arrange funding for the development of West Seahorse with capital providers.
3D Oil continues to progress its plans for the development of West Seahorse, in addition to maximizing the value from its other exploration assets within VIC/P57 and T-41P. In particular:
In summary, the 3D Oil team has undertaken extensive work to progress the development of its significant underlying assets, including West Seahorse, and it is best placed to develop these assets and to maximize value for shareholders.
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