Rockpool Acqui Regulatory News (ROC)

30 Jan 2007 07:02

Roc Oil Company Limited30 January 2007 30 January 2007 ROC OIL COMPANY LIMITED ("ROC") STOCK EXCHANGE RELEASE ROC-LED JOINT VENTURE MOVES TOWARDS DEVELOPMENT OF BEIBU GULF OILFIELDS, OFFSHORE CHINA KEY POINT - A consortium of Australian companies, led by ROC, has moved towardsthe development of its oil discoveries offshore China, with the release today ofdetails of a just completed Appraisal Report. SUMMARY - ROC's wholly owned subsidiary, Roc Oil (China) Company, operator ofthe Block 22/12 Joint Venture, advises that it has completed the AppraisalReport ("the Report") for the Wei 6-12 South and Wei 6-12 oilfields in the BeibuGulf, offshore China. The Report has been submitted to the Chinese governmentauthorities with a view to moving the fields towards commercial development. - Based upon the oil in-place figures in the Report andmodel-generated recovery factors, it is estimated that the recoverable oil atthe Wei 6-12 South and Wei 6-12 oilfields ranges from a most likely case of 19MMBO to an upside case of 27 MMBO. - The Report does not address an additional 10 MMBO most likelyestimate for the recoverable oil in the undrilled Sliver and Footwall prospectswhich are adjacent to the Wei 6-12 South Field. - The Joint Venture is now moving towards the commercial developmentof the fields via a formal Front End Engineering and Design ("FEED") phase, dueto commence in late 1Q 2007 and a Final Investment Decision ("FID"), expected in2H 2007. Subject to normal industry caveats, including timely receipt ofgovernment approvals, availability of contractors and the cost of goods andservices, this schedule could lead to first oil production by 2009. In order toprogress the development concept as quickly as possible, the Joint Venture hasalready sanctioned work that would normally be conducted as part of a formalFEED process. BACKGROUND The Report only addresses the in-place oil at the Wei 6-12 and Wei 6-12 Southfields, without reference to the five mapped prospects which lie within 4 km ofthese fields nor to the other four known oil accumulations in the southern partof the permit. The Report's key point is: - Reservoir modelling indicates the most likely oil in-place for thetwo known fields is 56 MMBOIP, with a combined upside oil in-place of 78 MMBOIP.Approximately 80% of the in-place oil is contained within the Wei 6-12 SouthField. Application of simulation model-generated recovery factors of approximately 35%for Wei 6-12 South and 25% for Wei 6-12 accumulations, suggest that the mostlikely estimate of combined recoverable oil from these two fields is 19 MMBO,which could increase subject to reservoir optimisation. The potential upsiderecoverable oil volume for the two fields is 27 MMBO. It is anticipated that initial production from the potential development of theWei 6-12 and Wei 6-12 South fields will range from 10,000 BOPD to 15,000 BOPD.Assuming current oil prices, the fields' productive life could span 10 years. When the most likely oil in-place estimate for the two known fields (Wei 6-12South and Wei 6-12) is combined with the equivalent estimate for the twoadjacent, undrilled, prospects (Sliver and Footwall) contained in theIndependent Expert's Report which accompanied ROC's November 2006 Rights IssueProspectus, the total most likely oil in-place for the four featured Wei OilField Complex is approximately 83 MMBOIP; with an upside potential of 108MMBOIP. Subject to the successful drilling of the Sliver and Footwall prospects,the most likely total recoverable oil estimate for these four features is 29MMBO; with an upside potential of 37 MMBO. The Wei 6-12 South and Wei 6-12 production facilities would be designed toaccommodate potential oil accumulations in the Sliver and Footwall prospects andthe three other, higher risk, prospects which lie within four kilometres of theWei 6-12 South Oil Field. According to the Independent Expert's Report referredto above, these three other prospects have a mapped in-place P50 oil potentialof approximately 150 MMBOIP. The design of the Wei 6-12 South and Wei 6-12 production facilities would alsoallow for future expansion to accommodate the potential development of the otherfour oilfields in the southern part of the Block. Unlike the oil in the northernpart of the permit, the oil in these four southern fields is relatively heavyand viscous but these fields represent a large potential resource with anestimated P50 oil in-place of about 240 MMBOIP, as documented in the IndependentExpert's Report referred to above. Commenting on the Appraisal Report ROC's Chief Executive Officer stated that: "The results of the Appraisal Report are consistent with previous publicstatements by ROC. They pave the way for a move towards a cornerstone commercialdevelopment that could trigger a number of add-on development opportunities.Until now the difficulty with our activities in the Beibu Gulf has been gettingthe first cab to move off the rank and while we are not quite at that point justyet, we have certainly taken a big step in that direction. If the optimumschedule is maintained, the development of the Beibu fields will dovetail veryneatly into ROC's production and development activities in the Bohai Bay." The Block 22/12 Joint Venture comprises*: Roc Oil (China) Company 40% and Operator Horizon Oil Limited 30% Petsec Energy Ltd 25% Oil Australia Pty Ltd** 5% \* The China National Offshore Oil Company ("CNOOC") is entitled to participate upto a 51% funding equity level in any commercial development within Block 22/12. ** A subsidiary of First Australian Resources In accordance with ASX Listing Rules and AIM Rules, the information in theAppraisal Report is based upon information compiled, reviewed and signed off byMr Neil Seage, Senior Reservoir Engineer, Roc Oil Company Limited, Bachelors ofEngineering (Hons) and Arts; and Master of Business Administration. Overallcontent contained in this release has been compiled, reviewed and signed off byDr John Doran, Chief Executive Officer, Roc Oil Company Limited, BSc (Hons)Geology; MSc and PhD. Both reviewers have at least five years' relevantexperience within the sector and consent to the information in the form andcontext in which it appears. ------------------------- ------------------------Michelle Manook For further information please contact:General Manager - Corporate Affairs Dr John Doran on Tel: +61-2-8356-2000 Fax: +61-2-9380-2635 Email: jdoran@rocoil.com.au Or visit ROC's website: www.rocoil.com.au Dr Kevin Hird General Manager Business Development Tel: +44 (0)207 586 7935 Fax: +44 (0)207 722 3919 E-mail: khird@rocoil.com.au Nick Lambert Bell Pottinger Corporate & Financial Tel: +44 (0)207 861 3232 This information is provided by RNS The company news service from the London Stock Exchange