NEXT month Perth-based Woodside is due to drill the first
exploration well in a $US194 million ($A266 million) hunt for oil
beneath the desert sands and gulf waters of Libya.
The country had been off limits to Western companies due to
sanctions imposed by the US and the United Nations in the 1980s and
1990s in response to terrorist activities. Libya rejoined the
international community in 2003 after agreeing to pay $US2.3 billion
to the families of those killed in the 1988 bombing of a Pan
American flight over Lockerbie in Scotland.
Woodside was among the first back into the country known for its
big oilfields. Woodside's first exploration well is due to start
late next month in a rapid-fire six-well program in the onshore
Murzuq Basin, 1500 kilometres south-west of Tripoli.
Also, the first well in an initial seven-well program will be
drilled in the onshore portion of the Sirte Basin on the other side
of the country. The combined onshore program has been priced at more
than $US100 million and has Woodside as 45 per cent partner and
operator with Repsol and Hellenic Petroleum.
Libya has reserves of 36 billion barrels of oil, and it is
estimated that another 35 billion barrels of oil remains to be
found. Woodside has yet to detail the size of the oil targets it has
identified beneath the Sahara's sand dunes, but its permits in the
Murzuq and Sirte basins are very much in "elephant" country in
oilfield terms. So much so that one of the fields in the Murzuq
Basin where Woodside secured a large exploration block is actually
called Elephant.
The AGIP-operated field ranks as a 700-million-barrel field,
while a region to the west of the Woodside permit is home to
Repsol's 380-million-barrel El Sharara A and its 350-million-barrel
El Sharara fields.
In the onshore portion of the Sirte Basin, Woodside's five
exploration blocks are surrounded by several monster fields,
including the 5-billion-barrel Gialo field, the 4.2-billion-barrel
Amal field and the 2.5-billion-barrel Zelten field.
Woodside's agreement with the Libyan National Oil Corporation
followed the normalisation of diplomatic relations between Australia
and Libya.
Woodside has since expanded its exploration effort in Libya by
successfully bidding for four blocks in the offshore portion of the
Sirte Basin. Four exploration wells are expected to be drilled up to
100 kilometres offshore from Tripoli starting late next year.
The offshore program has been priced at $US94 million. Woodside's
partners are US group Occidental — returning to Libya after
abandoning its oil production interests there due to the US
Government's 1986 embargo — and an arm of the Abu Dhabi Government.
Woodside beat competition from more than 140 mainly US oil and
gas companies for the prized exploration ground in the oil-rich
African nation.
The Libyan Government will take anywhere from 10.8 to 38.9 per
cent of the oil and gas pumped from any developments on the permits
by the foreign companies, the return of which is part of the plan by
Libyan leader Colonel Muammar Gaddafi to double the nation's oil
output this decade.
Woodside shares rose 36¢ to $38.95 yesterday. The group's Libyan
exploration is eagerly awaited by the local market, but the gain was
more of a response to an overnight move in oil prices to more than
$US60 a barrel. The stock is set to close the year sporting a 96 per
cent gain.
This reflects the impact of the oil price spike on group
earnings; the effect that the boom in Asian demand for liquefied
natural gas is having on expansion plans at the group's
one-sixth-owned North-West Shelf gas project; and Woodside's plan
for the rapid development of its wholly owned Pluto LNG project.
source:
http://www.theage.com.au/news/business/woodside-joins-libyas-desert-ratrace/2005/12/29/1135732693430.html
Daabaco
Boggan | Print
