Anzon Secures Construction Vessel to Repair Basker Spirit

Anzon reports that the BMG Joint Venture has secured the construction vessel it needs to reinstate the Basker Spirit mooring system. A contract has been signed with SWG Offshore Pty Ltd to provide the construction vessel and associated project management for the work, which will allow full production from the Basker Manta fields to resume. SWG Offshore has in turn contracted the Havila Harmony from TS Marine Limited.

The Havila Harmony is a construction/diving support vessel and has the appropriate capacity to reinstate the mooring. It will be fitted with a saturation diving spread to ensure that a range of contingencies can be covered. It is expected to be mobilized to the field in mid-September, allowing production to recommence in late September/early October 2007. The BMG Joint Venture has insurance cover for both physical damage and business interruption.

Further investigation work since the Basker Spirit drifted from its normal position has shown that the basic integrity of the mooring system is not in question. The problem was due to a shackle pin dislodging, allowing the upper section of the mooring to separate from the anchor spread. While the associated costs and deferred production are a disappointment, the underlying problem can be rectified easily in a manner that minimizes the chances of a reoccurrence of the problem.

In parallel, the interim production strategy proceeds. The first ship-to-ship crude oil transfer between the Crystal Ocean and Basker Spirit has been completed and the Crystal Ocean has returned to site to recommence production. It is currently retrieving the mooring lines, but is expected to produce more than 3,000 barrels of oil per day until the Basker Spirit mooring is re-instated.

2008 Drilling Program

Anzon also says that the BMG Joint Venture has secured a drilling rig, the Kan Tan IV, for its 2008 drilling program. The contract with the Kan Tan IV is in addition to the drilling slot with the Ocean Patriot to be used to drill the Basker-6 development well in the 1Q 2008. The Kan Tan IV contract provides 135 days of additional rig time starting in mid 2008 with which to drill a range of wells that are likely to include additional Basker oil wells, gas delineation and exploration wells.

Access to the Kan Tan IV is via a consortium agreement with other oil companies operating in Australasia and is expected to provide the opportunity for additional drilling in 2009.

The participants in the Basker Manta Joint Venture are Anzon Australia as operator with 50% and Beach Petroleum with 50%.