ROC to Plan Development for BMG Phase 2, Beibu Gulf Oil Project
ROC presently remains on target to achieve its operating budget of approximately 11,000 BOEPD (4 MMBOE) of production. Production for 1H09 averaged 11,535 BOEPD and sales revenue was US $102.1 million.
Production for the Quarter averaged 10,293 BOEPD, down 20% on the previous quarter primarily due to a combination of planned and unplanned downtime at the Basker-Manta-Gummy ("BMG") and Cliff Head fields. The successful completion of planned workovers at Cliff Head and the current development drilling and workover program at BMG are expected to improve ROC's production performance during 2H09.
During the Quarter a number of important actions were taken by the Board and management to further balance ROC's asset portfolio and to strengthen the Company's financial position. The Company announced the sale of a 10% participating interest in the BMG Project for US $31.5 million to a subsidiary of Pertamina, the Indonesian national oil company. ROC also completed a successful share placement at A$0.78 per share to raise A$68.8 million and announced a share purchase plan for eligible shareholders.
ROC's strengthened financial position will enable the Company to move forward with development planning for the BMG Phase 2 Gas Project and the Beibu Gulf Oil Project. ROC is focused on achieving approval for both of these projects before the end of 2009. Importantly, the feasibility study for the Beibu Gulf Oil Project was completed during the Quarter and the basis for the planned development, involving the sharing of production facilities, was agreed in principle with CNOOC.
Significant progress was also made during the Quarter on ROC's ongoing development activities. The BMG Phase 1 Oil Project drilling and workover program on the Basker Field commenced. Subsequent to the end of the Quarter, the Basker-3 workover was completed and production from the well is planned to recommence in early August. At Zhao Dong, installation of platform facilities was completed and development drilling continued, with production averaging above 21,000 BOPD during the final week of the Quarter.
Despite industry volatility and global financial uncertainty, oil prices continued to strengthen during the Quarter. With the Brent oil price in excess of US$60/bbl in July and with ROC’s strengthened financial position, the Board and management are confident that the Company is well positioned to meet development objectives over coming years.
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