Unocal Farms in to Donggala PSC

Unocal's subsidiary, Unocal Donggala Limited, has reached agreement to farm in to the deepwater Donggala production-sharing contract (PSC) area offshore East Kalimantan, Indonesia.

Unocal Donggala will acquire a 19.55-percent working interest in the PSC. TotalFinaElf, the operator, Pertamina, and Inpex Corp. hold the balance.

The Donggala PSC area lies outboard of the Rapak PSC area where Unocal is operator and holds an 80-percent working interest. Unocal has made several discoveries on Rapak, including the deepwater Ranggas and Bangka fields. Water depth on Donggala ranges from 6,000 to 8,000 feet.

The farm-in is subject to final approval by the Indonesian government.

Unocal and ENI-Lasmo Indonesia Limited (Eni) also announced the award of the Muara Bakau PSC area, located offshore East Kalimantan and inboard of the company's Gula and Gendalo discoveries. Unocal will have a 50-percent working interest in the PSC. Eni will be the operator and hold the remaining working interest. Water depth on Muara Bakau ranges from 250 to 4,500 feet.

The Muara Bakau PSC has a two-well commitment in the first year of the PSC. 2003 exploration program

Unocal will resume deepwater exploration drilling in Indonesia in mid-March 2003. Sixteen wells, including 7 new field wildcats, are expected to be drilled during 2003. TotalFinaElf will operate two of the wells utilizing the Transocean's Sedco 601 drill rig. Unocal also expects to complete a contract soon for a fifth-generation semi-submersible rig that will be used to drill a series of deeper horizon wells offshore East Kalimantan in 2003.

The new drilling rig will give Unocal the ability to drill several thousands feet deeper than previously possible; below existing gas/oil discoveries at Ranggas-Gehem, West Seno, Sadewa, Merah Besar and Gula. The deep horizon program is designed to test deeper reservoir section, under or adjacent to known accumulations, for additional oil pay. Oil was encountered in two sands below a major gas accumulation in the Sadewa-1 well, but the primary reservoir targets could not be reached with Sedco 601 semisubmersible.