The Esso-BHP Billiton 50/50 joint venture is in advanced discussions to contract a drilling rig for a long-term drilling program to commence in February 2004. The rig will be capable of drilling wells from either existing platforms or in new locations. Depending on the success of initial wells, the program is expected to extend into 2005.
The planned drilling program is based on data acquired in 2002 by the largest proprietary 3D seismic survey ever undertaken in Australia. The survey covered more than 3,900km2 and the objectives were to identify new exploration prospects, provide data to better plan for the depletion of producing fields, and to assist in bringing small, undeveloped discoveries into production. Drilling will target both oil and gas opportunities, and all planned wells will be located within existing production license areas.
"We believe there are new oil and gas resources still to be found in the Gippsland Basin. From an exploration viewpoint, the program is all about finding new potential in a mature basin," said Doug Schwebel, Esso Australia Exploration Director. "In particular, the joint venture will be looking to leverage its ability to commercialise smaller resources due to their proximity to existing infrastructure. This will also help extend the productive life span of the existing platforms and pipelines," added Steve Bell, BHP Billiton Petroleum President of Exploration and Development.
In the 34 years since the Esso / BHP Gippsland joint venture began production in October 1969, more than 3.5 billion barrels of oil and 5 trillion cubic feet of gas have been produced.
Current production is around 140 thousand barrels per day of crude and 570 million cubic feet per day of gas.
Over the past five years, overall capital expenditures associated with the joint venture's Gippsland operations, including onshore facilities, have exceeded A$ 400 million annually, making it one of Australia's largest ongoing oil and gas investment programs.
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