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ARCO SAYS TWO RECENTLY DISCOVERED ALASKAN FIELDS COULD BE SIGNIFICANT; FIVE-YEAR CAPITAL SPENDING PROGRAM ANNOUNCED

 NEW YORK, April 13 /PRNewswire/ -- Two recent Alaskan oil discoveries and ARCO's five-year capital spending plan were discussed today by ARCO management during a meeting with security analysts in New York.
 ARCO said that the Sunfish discovery in Alaska's Cook Inlet has the potential to contain up to 750 million barrels of gross oil reserves if the geologic structures are filled and ARCO's geologic concepts are demonstrated.
 The company also said that the Kuvlum discovery in the Beaufort Sea involves a structure that could contain 1 billion barrels or more of gross oil reserves. If the field is deemed too commercial, however, development would be a challenge because of Arctic conditions, including ice floes.
 During his presentation, ARCO Chairman and Chief Executive Officer Lodwrick M. Cook told the analysts, "Alaska is a marvelous proven oil and gas province which is still only lightly explored."
 Over the years, Los Angeles-based ARCO has played a predominant role in Alaskan exploration and development. "Our strong competitive differentiation has become even stronger as other companies reduced their exploration efforts or abandoned the state," Cook said.
 The Sunfish discovery, made in 1991, came in an area which many thought was "played out." With a 1992 delineation well, the Sunfish sands were confirmed as commercially viable, and the North Foreland sand was discovered.
 ARCO and Phillips Petroleum, as 60/40 percent partners, acquired nearly 130,000 acres to the south and west of the Sunfish discovery at a state lease sale in January 1993.
 "We believe the discovery at Sunfish extends over this newly acquired acreage on the South Cook Inlet anticline," said H.L. "Skip" Bilhartz, president of ARCO Alaska Inc. "We now believe we have identified enough economically recoverable oil at Sunfish to justify development, although several additional wells will be required to solidify the scope of those plans."
 The Kuvlum discovery well, drilled in the summer of 1992, flowed at 3,400 barrels per day. Under producing conditions, Bilhartz said, "the rate could be greater than 10,000 barrels per day. Data from the single discovery well indicate that the size of the structure could make Kuvlum the largest domestic oil discovery since Prudhoe Bay and Kuparuk were discovered decades ago. The prospect, in which ARCO has a 50 percent interest, could contain at least 1 billion barrels or more of gross reserves. Although the prospect is potentially a large one, its size does not match that of Prudhoe Bay. In the extreme case where the structure is full and the sands are thicker -- a case we give less than a 1 percent probability -- the structure could contain 6 billion barrels of oil."
 In addition to the Sunfish and Kuvlum discoveries, ARCO and its partners have announced three other significant Alaskan discoveries since 1988. These include the Point McIntyre discovery north of Prudhoe Bay which goes into production later this year, and the Fiord and Kalubik discoveries in the Colville High area west of the Kuparuk River field, the second largest oilfield in North America.
 "It is apparent from this year's drilling that it will take at least one more winter drilling season in the Colville High area to further evaluate the 1992 discoveries," Bilhartz said.
 ARCO also told analysts today that its total capital spending for the five-year period between 1993 and 1997 is expected to total $13.5 billion. Investment for exploration and development projects in Alaska is expected to be roughly $3.4 billion, or 25 percent.
 ARCO's overseas exploration and development programs will take $3.7 billion, or 27 percent, of the five-year program. ARCO International Oil and Gas Co. has major natural gas field developments underway in Indonesia and the South China Sea. In addition, the company continues its emphasis on international exploration.
 ARCO's Lower 48 exploration and development division, ARCO Oil and Gas Co., is budgeted at $1.7 billion, or 13 percent, with development of existing projects taking the largest share.
 ARCO Products Co., the refining and marketing division, will account for 15 percent, or $2.1 billion. Roughly one-third is required for compliance with federal, state and local clean air and environmental requirements.
 ARCO Chemical Co., in which ARCO holds an 83.4 percent interest, makes up $1.9 billion, or 14 percent, of the expected capital spending.
 ARCO Coal Co., which operates mines in the western United States and Australia, is near completion on a new mine development in Australia, and has completed other major capital projects in two U.S. mines. As a result, ARCO Coal's requirements in the five-year program will be slightly more than $300 million.
 ARCO Transportation Co., which links the company's Alaskan oil production with its West Coast refining and marketing program and operates commercial pipeline and terminal assets as well, will spend slightly more than $300 million during the five-year period.
 -0- 4/13/93
 /CONTACT: Albert Greenstein of ARCO, 213-486-3384/


CO: ARCO ST: New York, Alaska IN: OIL SU: DSC

MS-BP -- LA001 -- 5336 04/13/93 15:43 EDT
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Date:Apr 13, 1993
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