Unocal Starts Production from Pailin Field Offshore Thailand

Unocal Corporation has started natural gas production from the Phase II development of the Pailin field in the Gulf of Thailand. Phase II (North Pailin) facilities are producing 165 million cubic feet (mmcf) of gas per day, raising the gross contracted natural gas sales from the Pailin field to 330 mmcf per day under an agreement with PTT Public Company Limited.

The Phase II facilities achieved production rates as high as 230 mmcf per day during commissioning in June, which demonstrated the capacity of the Pailin field to provide more than 380 mmcf per day should market demand require.

In addition, the Phase II facilities in the Pailin field are producing 6,800 barrels of condensate per day (b/d), raising total condensate production from Pailin to more than 15,300 b/d. The Phase II development is in the northern part of Pailin field, which is located in the B12/27 concession area.

Unocal Thailand is operator of the field and holds a 35 percent working interest. Co-venturers consist of PTT Exploration and Production Public Company Limited (45%), Amerada Hess Exploration (Thailand) Co., Ltd. (15%), and MOECO Thai Oil Development Co., Ltd. (an affiliate of Mitsui Oil Exploration Co., Ltd., 5%).

"Production of natural gas from North Pailin is another major milestone toward greater energy security for Thailand. In addition to increased royalty and tax payments to Thailand, the Kingdom now has access to a larger volume of inexpensive, efficient natural gas for power generation and other uses," said Tara Tiradnakorn, Unocal Thailand's vice president of operations.

Pailin is Unocal Thailand's largest and most complex single project and employs the latest environmental technologies. Unocal has installed 11 wellhead platforms and two processing platforms to serve the entire field. Unocal and its co-venturers have invested over $820 million in developing Pailin. Gas from the field is sold to PTT, the partially privatized state petroleum company, under a 30-year gas sales agreement signed in 1996. Phase I production began at Pailin in August 1999.

With the new production from Pailin Phase II, gross natural gas production from the fields operated by Unocal Thailand now totals 1.07 billion cubic feet of gas per day for the Thai market. In addition, Unocal has ramped up gross oil production from the Yala-Plamuk complex to more than 16,800 barrels per day (Unocal, 71.25% working interest).

Unocal is also an investor in the Yadana project in Myanmar (Unocal, 28.25% working interest), which is producing about 700 million cubic feet of natural gas per day for the Thailand market.