RNS Number : 4330Y
  Anzon Energy Limited
  07 July 2008
   


    ANZON ENERGY LIMITED (CODE: AEL)

    7 July 2008

    ANZON ENERGY LIMITED ANNOUNCES THAT ITS SUBSIDIARY
    ANZON AUSTRALIA LIMITED (ASX CODE: AZA) HAS TODAY MADE
    THE FOLLOWING ASX ANNOUNCEMENT


    BMG Project Major Expansion
    LOIs signed for New FPSO and Drilling Rig




    The Basker Manta Gummy (BMG) Joint Venture (JV) is pleased to announce its intent to move forward on a major expansion of its Oil & Gas
Development in the Gippsland Basin (Vic L26, L27 and L 28). 

    On Friday 4th July the JV signed a Letter Of Intent (LOI) with BW Offshore AS (BWO) for the design, conversion, installation and
operation of a purpose built Floating Production Storage and Offloading vessel (FPSO) of Suezmax size (850,000 barrels), which will have the
capability to handle higher oil, water and gas rates than the present Crystal Ocean and Basker Spirit system. This new single vessel will
replace the combination of the mini FPSO and shuttle tanker that has been the trademark of the innovative Basker Manta development since it
started up 2.5 years ago and has now produced nearly 5 million barrels of oil. 

    The higher than originally expected reserves and the delineation of a significant gas resource, has enabled the JV to justify a larger
facility and more optimal development including:

1. a forecast doubling of current oil rate to around 20,000 bopd
2. the offshore processing of gas (capacity 120 MMscfd) to sales quality for transport by high pressure pipeline 90 km to the onshore
Eastern Gas Pipeline (EGP) or reinjection into the reservoir for later production
3. the offshore ship to ship transfer of liquids, eliminating logistical downtime
4. an environmentally responsible development with zero flare discharge and nearly zero onshore *footprint*
5. improved reliability including redundant equipment

    The operating Lease Contract for the FPSO is expected to be finalized before the end of September 2008, and commissioning in Bass Strait
is expected 2nd quarter 2010.

    In addition, the BMG JV has entered into a LOI to contract the semi-submersible drilling rig Songa "Venus" for commencement of drilling
in Nov/Dec this year for between 120 to 150 days. This rig will supplement the Maersk "Kan Tan IV" which will commence in May 2009, a 135
day drilling program. In total, between the two rigs, some 4 development wells (Basker, Manta and Gummy) targeting both Intra-Latrobe and
Golden Beach sands, and possibly 1 or 2 appraisal/exploration wells, will be drilled. These wells are planned to be connected via manifolds
and risers to the FPSO via a newly installed disconnectable Submerged Turret Production (STP) buoy and mooring.

    In aggregate the Joint Venture is planning to spend up to A$1230 million dollars on drilling, completing and subsea connections
including manifolds and pipeline, while the new FPSO, in which BWO is investing approximately US$400m inclusive of its gas processing
facilities, will be leased for an initial period of 5 years plus options to extend the contract for up to a total period of 15 years. BWO
will effectively provide all services; including the vessel, operations and maintenance.


    The participants in the Basker-Manta Joint Venture are:

    Anzon Australia Limited                                 40%    (Operator)
    Beach Petroleum Limited                                 30%
    CIECO Exploration and Production (Australia) Pty Ltd    20%
    Sojitz Energy Australia Pty Ltd                         10%



    FOR FURTHER INFORMATION PLEASE CONTACT:

    Anzon Energy Limited: Mr Tony Strasser +61 2 9024 3555

    Grant Thornton UK LLP: Fiona Owen +44 20 7383 5100

This information is provided by RNS
The company news service from the London Stock Exchange
 
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