Baker Energy Finalizes Contract with Phillips

Baker Energy has finalized a performance-based contract with Phillips Petroleum Company for operations and maintenance of seven production platforms in the company's Ship Shoal 149 Field on the Gulf of Mexico outer continental shelf.

The contract is for four years and has a total value of $9 million, plus performance and safety-based bonuses. It became effective on September 1, 2001.

This contract is an expansion of the operational consolidation Baker is leading throughout the Gulf of Mexico, called OPCO(SM). Under OPCO, Baker Energy is implementing a sophisticated operating model that redefines business-to-business relationships in the Gulf of Mexico. Baker Energy has invested in building an infrastructure of marine vessels, helicopters, shorebases, information technology, specialists, safety and compliance systems, and a leadership team that manages the sharing of resources, resulting in improved profitability for OPCO participants. Presently, the company is working under OPCO arrangements with ExxonMobil, El Paso Production and Burlington Resources. With the addition of Phillips, Baker has full operational responsibility for more than 160 manned and unmanned production facilities in the Gulf of Mexico under the OPCO model.

"Our OPCO consolidation model continues to gain acceptance among energy producers in the Gulf of Mexico as an innovative way to reduce costs, improve production efficiencies, and assure safety, environmental protection and regulatory compliance," Michael Whitten, president of Baker Energy, said. "We are actively pursuing other significant opportunities that exist to expand the network further, to the benefit of current participants and to Baker Energy."