Lundin gung-ho for PM3, BACK IN PLAY - From this weeks issue of Upstream
SWEDISH company Lundin is upbeat about the second phase of it's PM3 development in the Malaysia-Vietnam Commercial Arrangement Area, now the worst of the Asian economic crisis is over, writes Amanda Battersby.
Lundin, which postponed the project earlier this year due to low oil prices and considered reducing it's equity stake, is now optimistic about finalising gas sales contracts that will provide a firm development timetable.
Gross proven and probable reserves for PM3-CAA currently stand at 1.85 trillion cubic feet of gas and 155.3 million barrels of liquids. This is the first time Lundin has gone public with any figures since early last year when reserves were put at 380 million barrels of oil equvivalent.
What PetroVietnam intends to do with it's share of PM3 gas remains to be seen. The state company has revealed ambitious plans to install pipeline infrastructure to import gas for use in the domestic market even though such a scheme would require massive investments.
Meanwhile, PetroVietnam is understood also to have held discussions with an Asian-based contractor regarding the potential sale of PM3 gas at the wellhead for offshore conversion into methanol, local sources said.
Although the exact timing of PM3's second phase remains unclear, the partners are not resting on their laurels. The second phase will see liquids production boosted to 40,000 boepd and gas output to 250 MMcfd.
"We plan to drill a further development well on the Bunga Kekwa field", the Swedish company said. Phase-one output from PM3 averaged 12,460 bpd of oil in the first six months of this year.
Lundin, headed by Adolf Lundin, recently completed a 3D seismic survey over the southern part of block PM3, which indicated significant further hydrocarbon potential on the acreage and bodes well for the future exploration forays. The co-venturers now need a firm gas sales deal to enable them to exploit the already discovered reserves. |
