Rockpool Acqui Regulatory News (ROC)

28 Mar 2006 07:04

Roc Oil Company Limited28 March 2006 28 March 2006 ROC OIL COMPANY LIMITED ("ROC") STOCK EXCHANGE RELEASE ACTIVITY UPDATE 1. PRODUCTION AND DEVELOPMENT 1.1 Chinguetti Oil Field, Offshore Mauritania (ROC: 3.25%) Since oil production commenced at the Chinguetti Oil Field on 24 February 2006,the target production rate of 75,000 BOPD was achieved within two weeks, andwithin three weeks cumulative gross oil production exceeded 1 million barrels.The first cargo loading, of approximately 1 million barrels (ca 60,000 BBLS netto ROC) of crude oil was completed on 22 March 2006 and is destined for China,representing ROC's first oil sale from Africa. 1.2 Cliff Head Oil Field, Offshore Perth Basin, Western Australia (ROC: 37.5% and Operator) The onshore Arrowsmith Stabilisation Plant ("ASP"), which will receive the oilproduced from the Cliff Head Oil Field, is mechanically complete. Commissioningis well advanced with all pipelines and umbilicals successfully hydro-tested andfuel gas (sourced from Arc Energy Ltd) delivered to the plant. The mainoutstanding work at the ASP includes powering-up and commissioning thegenerators and water injection pumps. Subsequent to the jack up drilling rig lifting the production deck onto the wellhead jacket and the installation on the deck of the Coil Tubing Unit, to be usedfor maintenance and interventions, the main focus of the offshore work is now ondrilling and completing the development wells. Currently, drilling is running about three weeks behind schedule due to a numberof factors including two stuck-pipe instances, both of which were resolved.Other factors which have influenced the precise timing of the developmentinclude: availability of contractor personnel; adverse weather conditionsaffecting the timing of the offshore platform-pipeline hook up; and equipment atthe ASP. On a problem free basis, the first two oil production wells, CH-7H and CH-6, areexpected to be ready to deliver first oil to the ASP by mid April 2006. Theremaining development wells will then be brought on stream through the balanceof April/May 2006 to ramp up total field production to the production of inexcess of 10,000 BOPD. In its first year, Cliff Head oil production is expectedto equate to approximately 10% of Western Australia's oil consumption. The delay factors have also resulted in an approximate $20 million (7.5%)increase in budget projections compared to the most recent estimate of $265million. This budget revision represents a $43 million (19%) increase comparedto the $227 million budget estimate provided at Final Investment Decision inMarch 2005, and excluding the approximately $15 million relating to increases inproject scope. 2. EXPLORATION DRILLING 2.1 WA-351-P, Offshore Western Australia (ROC: 20%) As advised, the Jacala-1 exploration wildcat well in the deepwater part of theoffshore Carnarvon Basin started drilling on 23 March 2006. The well wasexpected to take 18 days to reach a total depth of 2,322 metres. However, due tooperational problems with setting the conductor and an evacuation of personnelfrom the Atwood Eagle rig due to cyclone activity, the well is now expected torespud by the end of the week. This timing is still subject to there being nofurther cyclone activity. 2.2 PEDL030, Onshore UK (ROC: 100% and Operator) Operations have commenced at the Willows-1 exploration wildcat well locatedabout 55 km east of York and approximately 15 km south of Scarborough, with thesurface conductor set at 122 metres using a small drilling rig prior to the ROCowned Explorer Rig being erected on site. In accordance with the well planningschedule, current operations are based on a day-only work schedule and will notbe increased to a 24/7 basis until the well officially commences drilling in midApril 2006. Willows-1 is a high risk - high reward well which will drill to a total depth of2,550 metres in about four to six weeks. The primary target is the PermianRotliegendes sandstone with potential recoverable reserves in the order of 50 to100 BCF. 2.3 Block 22/12, Beibu Gulf, Offshore China (ROC: 40% and Operator) In February 2006, Roc Oil (China) Company on behalf of the Block 22/12 JointVenture, contracted from China Offshore Services Limited ("COSL") the COSL 931jack up drilling rig on the basis of a mid April 2006 start date. However, theprecise timing is subject to continuing discussions. 2.4 Cabinda South Block, Onshore Angola (ROC: 60% and Operator) ROC is currently evaluating rig bids, received through a competitive tenderprocess, for its exploration drilling programme in the Cabinda South Block,onshore Angola. The current intention is that the drilling programme willcommence late 2006, subject to rig timing. In addition, an aeromagnetic surveycommenced on 12 March, the principal contractor being Worley Parsons GPX PtyLtd. The survey covers the entire onshore Cabinda South Block with acquisitionvirtually complete. 3. TRANSACTIONS 3.1 UK North Sea ROC has negotiated a 1% overriding royalty with regard to future grossproduction from the exploration areas surrounding the Ardmore Field,specifically P1036, P1037, P1038 and P1126 (covering Blocks 30/24d, 30/24c, 30/24a and 30/29b, respectively). 3.2 China Oil Shale Since 2001, ROC has reviewed various opportunities relating to oil shaledevelopment projects in Fushun, Liaoning Province, northeastern China, where alarge oil shale operation is already well established by Fushun Mining Group(see ROC ASX Release, 15 June 2005). In this context, ROC has been instrumentalin introducing Canadian oil shale technology and large scale German engineeringexpertise into the Fushun oil shale industry. As a result of a contract signedbetween the German and Chinese participants in the planned expansion of the oilshale operations, ROC will receive a small revenue stream in the form ofcommissions. Whilst this is not material to ROC this represents the firstrevenue from the Company's activities within the Chinese energy industry. Michelle ManookGeneral Manager - Corporate Affairs For further information please contact: 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