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Gold/Mining/Energy : Strictly: Drilling and oil-field services -- Ignore unavailable to you. Want to Upgrade?

To: Razorbak who wrote (66162)	5/15/2000 12:23:00 PM
From: BigBull	Respond to of 95453

Hey Razor, I don't believe it! Big Oil is actually going drill the Faroes! These boys got oil on the brain. ;:o)))) ------------------------------------------------------------ Bloomberg Energy Mon, 15 May 2000, 12:18pm EDT 05/15 04:13 BP, Others to Bid to Drill Offshore the Faroe Islands (Update1) By Alex Lawler London, May 15 (Bloomberg) -- Texaco Inc., BP Amoco Plc and other international oil and natural gas companies plan to bid this week for the right to explore in the deep waters off the Faroe Islands in the region's first drilling. The deadline is Wednesday, and the government aims to award licenses in September. The Faroes, which lie in the North Atlantic between Norway and Iceland, last year settled a decades-long dispute with the U.K. and Denmark on dividing up the seabed, clearing the way for segments to be offered for drilling. While it isn't known what lies beneath the ocean floor, companies began surveying the area in the mid-1990s. Some say the geology could match discoveries in waters around the Shetland Islands, where one field holds 400 million barrels of oil, enough to power the U.K. for more than seven months. ``There may be significant discoveries to be made,'' said Jacqueline Brees, an analyst at Wood Mackenzie Global Consultants, part of Deutsche Bank AG. ``Some people think there's going to be a continuation'' of geology around the Shetlands. Analysts said companies that produce oil and gas in waters west of the U.K. Shetland Islands -- such as BP, the third-largest publicly traded oil company -- will likely show the most interest in the Faroes. BP said it will participate, as did Norsk Hydro ASA of Norway and Amerada Hess Corp. of New York. Texaco, the third-largest U.S. oil company, would begin drilling off the Faroes next year if it won a concession, said Donal O'Driscoll, an exploration manager there. White Plains, New York-based Texaco is bidding with Houston-based Conoco Inc., Murphy Oil Corp. and other partners. Exploration for oil and gas in the North Sea, where oil was first tapped in 1964, is beginning to decline. The U.K. Offshore Operators' Association, a trade group, said earlier this year that about half the region's reserves had already been pumped out. With their profits surging as crude oil prices more than doubled in 1999, companies are open to making investments in regions like the Faroes, where costs will likely be higher than they would in some parts of the world such as the Middle East, analysts say. The Faroe Islands have a population of 45,000 and have been a self-governing region of Denmark since 1948. Negotiations with Denmark for sovereignty began earlier this month. The first licensing round covers an area of about 14,000 square kilometers to the east and southeast of the islands and divided into 56 ``blocks'' and 26 fractions. ``A fairly large number of companies have been preparing themselves,'' said Martin Heinesen, head of the Faroe Islands geology department. As many as 25 companies, individually or as members of a group, may submit bids, he said. BP is the largest producer of oil in waters west of Shetland, where it operates two oil fields, Schiehallion and Foinaven, that have combined crude oil reserves of about 600 million barrels. The Royal Dutch/Shell Group and Lasmo Plc said they withdrew from bidding. -------------------------------------------------------------------------------- ¸ Copyright 2000, Bloomberg L.P. All Rights Reserved.