AMOCO RECEIVES CHINA'S APPROVAL FOR $650 MILLION LIUHUA OIL FIELD DEVELOPMENT PLAN IN SOUTH CHINA SEA
HOUSTON, April 19 /PRNewswire/ -- Amoco Orient Petroleum Company (AOPC) and China Offshore Oil Nanhai East (CONHE) said today that they have received approval from the Ministry of Energy, People's Republic of China to begin the $650 million (U.S.) development of the Liuhua 11-1 Oil Field in the South China Sea. The Liuhua field, discovered in 1987, is the largest oil-bearing accumulation found to date in the South China Sea. The field is located approximately 120 miles south, southeast of Hong Kong in 1,000 feet of water. Following the discovery, Amoco and CONHE undertook an extensive delineation and appraisal program that determined the use of floating production systems with subsea horizontal wells to be the optimum means of field development. "The challenges presented by Liuhua development have resulted in not only innovative technical solutions but also the formulation of significant progressive management processes," said William Hudson, president of AOPC in Shekou. "Highly qualified teams from both AOPC and CONHE are now working together to effectively meet the unique demands of the project." Amoco will be the operator of the project with 49 percent working interest and will co-manage the project with its Chinese partners CONHE from offices in Houston and Shekou, in the Shenzhen Special Economic Zone in Guangdong Province. Production from the field should begin in early 1996 and the full development program is expected to be completed in 1997. Following the $650 million development phase, Amoco and CONHE expect costs for the estimated 15-year production phase to approach an additional $850 million. "Approval for development of the Liuhua field represents a major milestone in Amoco's activities in China," said Martin Zimmerman, vice president of Amoco's International Business Unit in Houston. "Our strong working relationship with our Chinese partners will enable us to operate at a high level of activity and achieve the success that is critical to our long-term strategy in China." The Liuhua 11-1-1A discovery well encountered some 250 feet of hydrocarbons which flowed at a pump-assisted rate of 2,240 barrels of 20-degree API gravity oil per day. Pump-assisted tests on a later delineation well resulted in initial rates of 8,000 barrels per day. The Liuhua 11-1-6 well -- one of the longest offshore horizontal wells on record -- initially pumped 12,000 barrels of 21-degree API gravity oil per day in an extended drill-stem test. Liuhua development will require a unique combination of floattly- moored Floating Production System (FPS). Production facilities and crude storage will be located on a separate Floating Production, Storage, and Offloading Vessel (FPSO). The wells will produce aided by electric submersible pumps (ESPs). This development will be the first time the oil industry has used ESPs in subsea wells and their use demanded development of new technology to supply power to the ESPs. The FPS will be a modified semi-submersible drilling rig with the necessary systems to drill, complete, and workover horizontal subsea wells. Additionally, the FPS will install and operate subsea manifold systems and house electrical generation and distribution equipment to provide power to the ESPs. The FPSO will be a modified crude oil-carrying tanker which will process crude oil, store processed oil, flare associated gas, and process produced water. The FPSO will support processing equipment and well testing equipment necessary to handle up to 65,000 barrels of oil per day and 300,000 barrels of total fluids per day. The vessel will have some 720,000 barrels of storage capacity. Produced crude will be offloaded via tandem moored shuttle tankers.
Both the FPSO and the FPS will be moored with multiple catenary lines designed to permit the vessels to remain on station through a 100-year typhoon.
Selection of general contractors to aid in the engineering, construction, and conversion of the FPS and FPSO is proceeding with acquisition of the actual vessels targeted for later this year. China Offshore Oil Nanhai East is a subsidiary of China National Offshore Oil Corporation. Amoco Orient Petroleum Company, a subsidiary of Amoco Production Company, is currently active in three contract areas in China: two offshore areas located in the Pearl River Mouth Basin of the South China Sea, and onshore acreage in the Fuyang basin in Anhui Province in Southeast China. Amoco Production Company is the worldwide exploration and production subsidiary of Amoco Corporation (NYSE: AN). -0- 4/19/93 /CONTACT: Dave Tayrien, Amoco Public and Government Affairs - Houston, 713-556-3701, or Greg Clock, Amoco Public and Government Affairs - Chicago, 312-856-5481/ (AN)
CO: Amoco Corporation ST: Illinois, Texas IN: OIL SU:
BM -- CL013 -- 7393 04/19/93 12:19 EDT
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|Date:||Apr 19, 1993|
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