Interim Management Statement

RNS Number : 6197G

Soco International PLC

16 May 2011

 



16 May 2011

SOCO International plc

("SOCO" or the "Company")

INTERIM MANAGEMENT STATEMENT

SOCO today announces its Interim Management Statement relating to the period from 1 January 2011 to 16 May 2011.

OVERVIEW

·      Te Giac Trang ("TGT") on track for production commencing in mid-August, plateauing at approximately 55,000 barrels of oil per day ("BOPD")

·      PetroVietnam has approved the Full Development Plan for the TGT Field including preparations for second phase development drilling which will add approximately 40,000 BOPD to TGT production potential

·      Te Giac Den ("TGD") licence extension has been granted by the Government of Vietnam and it is expected that seismic acquisition programme will commence in July 2011

·      Three exploration wells are planned in Congo (Brazzaville), with the first well on Block Marine XI expected to spud in September 2011

OPERATIONS 

Activity thus far this year has been primarily directed toward bringing the TGT Field offshore Vietnam onstream in August 2011 and in preparing for the three well offshore exploration drilling programme in Congo (Brazzaville), which is targeted to commence in the month of September. 

VIETNAM

Block 16-1

Te Giac Trang ("TGT")

TGT development drilling continued during the first quarter of 2011 with the completion of the four "batch" drilled development wells, TGT-4P to -7P, which commenced drilling in 2010.  The 2011 development drilling programme for the H1 unmanned platform concluded with the drilling of TGT-8P, the eighth development well. Petrophysical analysis indicates that the wells have confirmed the reservoir model. 

All the development wells are suspended and will be perforated to become producing wells on start-up of production, which is scheduled to commence in August 2011. Plateau production during this first phase of development is estimated to be circa 55,000 BOPD.

In May, PetroVietnam, the Vietnamese state oil company, informed the Company that the Government of Vietnam had approved the Full Development Plan for the TGTField, incorporating the accelerated second phase development with installation of a second unmanned production platform on the H4 fault block. Activities in the field are ongoing with the recent installation of the topsides on the H1 jacket, and the installation of the H4 jacket for second phase drilling and production is complete. The drilling deck on H4 is being installed at this time. The second phase of development drilling is expected to add up to circa 40,000 BOPD to TGT production potential in the summer of 2012.

Te Giac Den ("TGD")

The Government of Vietnam's agreement to the extension period for the TGD Appraisal area was also received in May 2011. The initial extension period is from 1 January 2011 to 30 April 2012.  An additional six months extension will be automatic (through 31 October 2012) in the event that the Company elects to drill a well. Several 3D seismic acquisition options are currently being reviewed as it is anticipated that acquisition of the 150 square kilometre 3D programme will commence in July 2011.

Ca Ngu Vang ("CNV")

At the CNV producing field in Block 9-2 offshore Vietnam, operated by the Hoan Vu Joint Operating Company, negotiations are underway with Vietsovpetro, the operator of the Bach Ho processing facilities, wherein Vietsovpetro would install additional dedicated test separation facilities on the Bach Ho central processing platform complex in order to more accurately measure liquid and gas production from the CNV production stream entering the Bach Ho facilities.  The benefit to the Company will be a more accurate allocation of CNV oil, gas and gas liquids production within the Bach Ho production system. CNV production net to the Company's interest has averaged 2,551 barrels of oil equivalent per day during the first four months of 2011. 

AFRICA

REPUBLIC OF CONGO (BRAZZAVILLE)

Preparations are underway to drill up to three exploration wells offshore Congo (Brazzaville), with the first well expected to spud in early September.  A rig has been contracted and is in dry dock for refurbishment prior to spudding the first well.  The initial well will drill a pre-salt target on the Marine XI Block with estimated pre-drill unrisked mean recoverable resources of 165 million barrels and should take approximately 45 days to drill. The second well will target the Miocene interval above the salt layer on the Marine XIV Block.  With pre-drill unrisked mean recoverable resources of 40 million barrels, the well should take approximately 30 days to drill.

If the first well is successful, an appraisal well is expected to be drilled on the pre-salt target.  If not, the final well in this exploration programme will be drilled on a Miocene target in the Marine XI Block with 70 million barrels of pre-drill mean unrisked recoverable resources.

DEMOCRATIC REPUBLIC OF CONGO (KINSHASA) ("DRC")

The security review over Block V in the Albertine Rift in the DRC is ongoing.  An initial environmental impact assessment ("EIA") was submitted to the Groupe d'Etudes Environnementales du Congo in March 2011.  After a period of review and consultation with stakeholders, including various departments within the Government of DRC, a final EIA was submitted in May. 

OUTLOOK

TGT is on track to commence production in mid-August 2011.  The floating production storage and offloading vessel should be onsite in July.  The drilling rig is expected to begin drilling development wells from the H4 platform in September. 

If an agreement is reached soon with Vietsovpetro regarding the separation facilities for the CNV production stream, installation of the separation facilities is anticipated to be complete in the early fourth quarter.

Further evaluation of the Nganzi Block, onshore the DRC, is being undertaken, incorporating information gathered in the 2010 drilling programme to better understand the prospectivity of the Block.  Remapping of the seismic is underway, focusing on the Chela formation.  The exercise will be concluded during the third quarter of 2011 in order to determine the forward programme prior to the end of the initial exploration period.

The Block V project can be progressed into the seismic acquisition stage over Lake Edward upon approval of the EIA report by the Government of DRC.  The Company anticipates the review of the EIA report to be concluded prior to the beginning of the third quarter of this year.

The Company continues to evaluate exploration opportunities in South East Asia and Africa.  Although it is not guaranteed that any new projects will be introduced in the near term, the TGT oil development in Vietnam is set to transform the cash resources of the Company when it comes onstream in a few months. 

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ENQUIRIES:

SOCO International plc

Roger Cagle, Deputy Chief Executive and Chief Financial Officer

Tel: [phone]

Pelham Bell Pottinger

James Henderson

Victoria Geoghegan

Tel: [phone]

NOTES TO EDITORS:

SOCO is an international oil and gas exploration and production company, headquartered in London, traded on the London Stock Exchange and a constituent of the FTSE 250 Index. The Company has interests in Vietnam, the Republic of Congo (Brazzaville), the Democratic Republic of Congo (Kinshasa) and Angola, with production operations in Vietnam.

SOCO holds its interests in Vietnam, all in the Cuu Long Basin offshore, through its 80% owned subsidiary SOCO Vietnam Ltd. ("SOCO Vietnam") and through its 100% ownership of OPECO, Inc. SOCO Vietnam holds a 25% working interest in Block 9-2, which is operated by the Hoan Vu Joint Operating Company and holds a 28.5% working interest in Block 16-1, which is operated by the Hoang Long Joint Operating Company. OPECO, Inc. holds a 2% interest in Block 16-1.

SOCO holds its interests in the Republic of Congo (Brazzaville), all offshore in the shallow water Lower Congo Basin, through its 85% owned subsidiary, SOCO Exploration and Production Congo SA ("SOCO EPC").  SOCO EPC holds a 29% interest in the Marine XI Block and a 19.4% interest in the Marine XIV Block and is designated operator of the two Blocks.

SOCO holds its interests in the Democratic Republic of Congo (Kinshasa), all onshore, though its 85% owned subsidiary, SOCO Exploration and Production DRC Sprl ("SOCO E&P DRC").  SOCO E&P DRC holds a 65% working interest in the Nganzi Block, situated 50 kilometres from the west coast, and a 38.25% participating interest in Block V, situated in the southern Albertine Graben in eastern DRC.  SOCO E&P DRC is designated operator of both Blocks.

SOCO holds its interests in the Angolan enclave of Cabinda through its 80% owned subsidiary, SOCO Cabinda Limited, which holds a 17% participating interest in the Production Sharing Agreement for the Cabinda Onshore North Block.

 

END

 

 

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