Rhum Gas Field Development

BP PLC
21 May 2003



May 21, 2003


RHUM GAS FIELD GETS GREEN LIGHT


BP, on behalf of its co-venturer, today announced plans to develop the Rhum gas
field at a cost of around £350 million.


Development of the Rhum field, which was discovered in 1977, is challenging. The
gas reservoir is subject to extreme temperatures and high pressure. Development
of the field has been under review for some time but it has only been relatively
recently that development has become viable.


Outlining plans for the proposed development today, BP's Group Vice President 
and Technical Director, Ian Vann, said the announcement underlined BP's 
continued commitment to the North Sea.


'The North Sea remains a very important part of BP's global business portfolio
and will continue to be important for many years to come. While we'll be working
to ensure our current assets can effectively compete for capital with other
assets in the BP world, we'll also continue to look for appropriate growth
opportunities. Rhum is a good example of the opportunities that still exist in
the North Sea.


'When Rhum was discovered back in the 70s, we knew we had a challenge on our
hands to develop the field, given the difficulties at that time in doing so. But
I'm pleased to say that through a combination of innovative thinking and our
experience of North Sea challenges, we have advanced to the point where this
difficult development is now viable. I'd also like to pay tribute to our joint
venture partners in the project, the Iranian Oil Company UK (IOC) whose support
and advice have been crucial in bringing the development forward,' said Mr.
Vann.


Rhum represents the first development in the North Sea for the IOC.


Brian Wilson, Minister for Energy & Construction, welcomes the project: 'I am
pleased to approve the Rhum development. The Rhum project is one of the most
significant developments in the North Sea in the last twelve months. It clearly
shows that there is significant potential in the North Sea and the scope for
exploiting new fields, although challenging, brings great rewards. I am glad
that BP is at the forefront of investing in the development of world-class
technologies that enable them to venture into more challenging reserves to
harness the power beneath the sea.'


A number of contracts for the project have already been let. These include the
contracts for module fabrication, and detailed design and project management,
both of which were won by Amec. It is expected that further contracts will be
awarded in the coming weeks.


The Rhum field is located 380km (240 miles) north east of Aberdeen in 109 metres
(350 feet) of water. The field is 44km (28 miles) from the BP operated Bruce
platform. The development of the field will involve a subsea tieback to the
Bruce field with gas being exported onwards from Bruce via the Frigg pipeline
system to St. Fergus. Associated condensate will be piped via Bruce into the
Forties pipeline system.


Rhum has estimated resources of 1.1 trillion cubic feet (31 billion cubic
metres) of gas, of which, 800 billion cubic feet (23 billion cubic metres) is
deemed recoverable.


Work on the project will commence immediately with first gas expected late in
2005.


Notes to editors:


• The Rhum field, which lies in block 3/29, was discovered in
1972.

• A well (3/29-2) drilled in 1977 gave the first indication of
the scale of the discovery.

• An appraisal well (3/29-a4) was drilled in 2000. This well
will be completed as part of the development drilling program expected to
commence later this year.

• Apart from use of the appraisal well (3/29-a4), the plan for
Rhum calls for a further three wells to be drilled as part of the initial
development. It is possible that an additional three wells could be drilled at a
later date.

• The Rhum field is a high temperature, high pressure
reservoir, experiencing down-hole temperatures of 150 degrees Celsius and
pressures of 12,000psi. For comparison purposes, the Bruce gas field, to which
Rhum will be tied in, records temperatures of 99 degrees Celsius and pressures
of 6,000psi.

• The field will be tied back to Bruce via a 44km export line
which will involve a 22 inch High Integrity, Pressure Protection System (HIPPS)
protected pipe-in-pipe main pipeline.

• The pipeline, which has to be specially manufactured to
withstand the extremes in temperature and pressure, will be made in Japan.

• Plateau production of 300 million standard cubic feet a day
is expected from the field.

• It is expected that Rhum will have a field life of around 16
years.

• The co-venturers in the Rhum development are:

BP (Operator)                50%

Iranian Oil Company UK       50%

• As part of the development, new gas processing facilities
will be installed on the existing Bruce Compression Reception Centre (CR)
platform.


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