Apache Corporation (APA), through its subsidiary Apache PVG Pty Ltd, commenced oil production from the Pyrenees development. The Pyrenees development is located in production license WA-42-L in the Exmouth Basin offshore Western Australia.
Apache owns a 28.57% interest in the $1.7 billion Pyrenees development. BHP Billiton (BHP) acts as the operator and owns the remaining interest.
Apache expects production from the Crosby, Ravensworth and Stickle wells in the Pyrenees to be brought on in phases, with approximately half the field ramping up from first oil and the other half over the next six months. These three oil fields were discovered in 2003 in water depths ranging from 555 to 820 feet approximately 27 miles (45 kilometers) off the coast of Exmouth, Western Australia. The project has an estimated production life of 25 years.
Additionally, Apache has a 31.501% interest in the part of the Ravensworth field located in production license WA-43-L. BHP Billiton Petroleum holds 39.999% and INPEX owns 28.5%. This part of the Pyrenees project will have its own wells and gathering system with oil production from the WA-43-L part scheduled to begin later in 2010.
Management indicated that the gas produced at the Pyrenees development will be re-injected into the reservoir of the nearby Macedon gas field. The Macedon gas field is in front-end engineering and design stage, with a final investment decision expected later in 2010.
Previously, the company had announced first oil from Apache PVG’s Van Gogh Field in production license WA-35-L in the Exmouth Basin. Apache PVG owns a 52.5% interest in the field with INPEX owning the remaining interest.
Pyrenees and Van Gogh are among a pipeline of projects that will add production from Apache’s exploration program in Western Australia and other regions in coming years. Currently, the company has two oil fields on production in Australia that will make a significant contribution to its projected growth in 2010. Net production from Pyrenees and Van Gogh is projected to quadruple Apache’s oil production in Australia.
Apache plans to invest nearly $1 billion in Australia during 2010, funding exploration as well as a range of development projects which includes the Macedon, Reindeer and Julimar/Brunello discoveries.
Furthermore, Apache’s Devil Creek domestic gas processing plant is scheduled for completion in 2011. Going forward, this plant is expected to process gas from the offshore Reindeer Field and increase Western Australia’s domestic natural gas production capacity by up to 20%.
Houston, Texas-based Apache Corporation is one of the world’s leading independent energy companies engaged in the exploration, development and production of natural gas, crude oil and natural gas liquids. Given our continued positive view of Apache’s underlying fundamentals, we expect another solid quarter, driven by the growth momentum from its robust project pipeline.
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