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Gassi El Agreb, Algeria |
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| PRODUCTION In the deepwater Gulf of Mexico, the Llano Field (AHC 50%) on Garden Banks Blocks 385 and 386, commenced production in April 2004. The field is currently averaging approximately 20,000 net barrels of oil equivalent per day. Net production from the Corporation’s deepwater Gulf of Mexico fields, which include Llano, Baldpate (AHC 50%), Conger (AHC 37.5%), Northwestern (AHC 50%) and Hack Wilson (AHC 33.3%), averaged approximately 38,000 barrels of oil equivalent per day in 2004. Onshore, Amerada Hess operates the Seminole San Andres Unit (AHC 34%) in West Texas, a carbon dioxide recovery project that commenced in 1983 and is recognized as one of the most successful tertiary recovery projects in the Permian Basin. In 2004, the Corporation continued development of the residual oil zone, which is one of several opportunities that will be pursued in the area over the next several years. In North Dakota, Amerada Hess is the leading oil producer. Production levels have been maintained over the last five years through a successful program of infill and horizontal drilling within several large company-operated units, including Beaver Lodge and Tioga Madison. In the United Kingdom, the Clair Field (AHC 9.3%) came onstream in February 2005 and is expected to average 5,500 net barrels of oil per day when it reaches plateau production. In the Norwegian sector of the North Sea, enhanced recovery continued in the Valhall Field (AHC 28.09%), with water injection and development of the north flank area adding approximately 4,000 barrels of oil per day of net production. In Equatorial Guinea, the Ceiba Field (AHC 85%) is currently producing 28,000 net barrels of oil per day and is expected to sustain that level over the next several years. DEVELOPMENT In Block A-18 (AHC 50%) of the Joint Development Area between Malaysia and Thailand (JDA), first production was achieved in early 2005. Net production is expected to average approximately 23,000 barrels of oil equivalent per day in 2006. Additional gas sales were negotiated in December 2004, which will allow us to double our proved reserves in the JDA over the next several years and contribute significant future production growth. In Equatorial Guinea, the development plan for our Northern Block G Fields (AHC 85%), now called the Okume Complex, was approved by the government in August 2004. The major contracts for construction have been authorized and development drilling will begin in 2006. First production from the Okume Complex is expected in early 2007 with net peak production estimated at 40,000 barrels of oil per day. In Algeria, the Corporation’s investment in the Gassi El Agreb redevelopment project, operated by SonaHess, a joint operating company of Amerada Hess and Sonatrach, has resulted in production from the fields being increased by over 100% since 2000. Net production averaged approximately 25,000 barrels of oil per day in the fourth quarter of 2004. In August 2004 the scope of the project to redevelop these fields was expanded, reflecting our success in this area. In the United Kingdom, commercial agreements associated with the Atlantic (AHC 25%) and Cromarty (AHC 90%) gas fields were completed. First production is expected in early 2006. Combined net production from these two fields is expected to exceed 20,000 barrels of oil equivalent per day in 2006. In Indonesia, following a successful drilling program the gas sales agreement for the Ujung Pangkah development (AHC 66%) was signed in the fourth quarter of 2004. Gas sales from the Pangkah Field are expected to commence in early 2007. Phase three of the development of the giant Azeri, Chirag and Guneshli fields (AHC 2.72%) in Azerbaijan to access reserves in the deepwater Guneshli area was sanctioned in the third quarter. Net production is expected to increase from 2,000 barrels per day currently to 25,000 barrels per day in 2008. EXPLORATION In the deepwater Gulf of Mexico, successful appraisal drilling was conducted on the Shenzi prospect (AHC 28%) on Green Canyon Block 653. The Shenzi-2 well encountered 500 feet of net pay and the Shenzi-3 well found 330 feet of net pay. Two additional appraisal wells will be drilled in 2005, after which the project is expected to be sanctioned. The Tubular Bells discovery well (AHC 20%) in Mississippi Canyon Block 725 is expected to be appraised in the second half of 2005. In Northeastern Thailand, Phu Horm Block E5N (AHC 35%) has been successfully appraised and is now in the permitting process. We expect this project to be sanctioned in 2005. In Malaysia, the Belud South-1 exploration well discovered hydrocarbons, encountering 352 feet of net pay, predominately gas. A down dip sidetrack was drilled which established oil in several sands. Further exploratory and appraisal drilling is planned during 2005. |
Production facility in North Dakota.
Drilling operations, Llano Field, Gulf of Mexico
Technical team in the United Kingdom.
Appraisal drilling in Thailand.
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