UPDATE: Santos Says Oil Found At Australian Finucane South Field
May 24 2011 - 10:32PM
Dow Jones News
Santos Ltd. (STO.AU) said Wednesday oil production could begin
by the end of 2013 at a new discovery and an adjacent find in
coastal waters off the northwest coast of Australia, with an
investment decision on developing the discoveries expected by the
partner companies before the end of this year.
The Australian company said oil has been discovered at Finucane
South, about seven kilometers from the Fletcher oil field
discovered in 2009 in the Carnarvon Basin. Drilling encountered
more than 18 meters of net oil in what is known as the Late
Jurassic Angel formation, it said.
Santos said engineering studies on jointly developing Finucane
South and Fletcher are advanced and a number of options have been
considered, including use of the nearby Santos-operated floating
production and storage facility at the Mutineer Exeter field, which
would enable first oil output by the end of 2013.
Perth-based Tap Oil Ltd. (TAP.AU), which has a minority interest
in the block where the new discovery and Fletcher field are
located, separately said early evaluation indicates the discovery
could exceed an estimate of 8 million barrels made before drilling.
The new well will be suspended after evaluation is completed, it
said.
The discovery at Finucane South follows a gas discovery in April
at the Zola-1 exploration well in the Carnarvon Basin, in which
both Santos and Tap are investors.
"Finucane South-1A makes our exploration success rate for 2011
two out of two following the significant gas discovery at Zola
earlier in the year," said Troy Hayden, managing director and chief
executive of Tap.
Santos holds a 33.4% interest in WA-191-P, where Finucane South
and Fletcher are located. Kufpec Australia has a 33.4% interest,
Tokyo-based JX Nippon Oil & Gas Exploration Corp. 25% and Tap
the remaining 8.2%.
Santos has a 24.75% interest in Zola, while operator Apache
Corp. (APA) holds 30.25% and OMV Australia, JX Nippon and Tap Oil
between them the remainder. Apache in April said it was too early
to speculate on reserve size at Zola, and a new seismic survey was
planned for later in the year.
-By Robb M. Stewart, Dow Jones Newswires; +61 3 9292 2094;
robb.stewart@dowjones.com
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