Shell Makes Deepwater Discovery Offshore Malaysia

Shell Malaysia announced that a Shell - Petronas Carigali - Conoco Phillips joint venture has made an important oil discovery with their recent Gumusut-1 exploration well, located in Deepwater Block J, in waters on the northwest of Sabah, Malaysia.

The Gumusut-1 exploration well encountered a long gross oil column in excellent reservoir quality rock. Initial indications are that the Gumusut crude oil is light and of high quality. The discovery well was drilled in a water depth of 1 km and was completed in December 2003, after 80 days of drilling operations; a vertical well and two sidetracks were drilled. The discovery was drilled by Atwood Oceanics' semisub, Atwood Falcon.

Jon Chadwick, Chairman of Shell Malaysia, said "This is a particularly pleasing oil discovery. It is good for Malaysia and good for the joint venture partners. The priorities are now to appraise the discovery and develop the field in a timely manner".

Chadwick added, "Shell and its partners are totally committed to a business strategy that generates wealth and contributes to Malaysia's economy. These are still early days for Gumusut, but this discovery is a key achievement. Development will require that state-of-the-art technologies are deployed"

The joint venture partners in Block J are Shell Malaysia with 40% equity, Conoco Phillips (40%) and Petronas Carigali (20% Equity). Shell Malaysia is the operator of the Block on behalf of this partnership.