| NOVEMBER 1999 - RELEASES |
WEEKLY ACTIVITIES UPDATE (25/11/99) |
|
1. ROC TO BE INCLUDED IN ASX INDEX ROC has been advised by ASX that, effective 1 December 1999, the company will be included in the All Ordinaries Index, with a 100% liquidity factor, as part of the "Index Group 04, Energy". 2. SALTFLEETBY GAS FIELD DEVELOPMENT (ROC 100%) Realignment work on the small portion of the pipeline within the Theddlethorpe Gas Processing Terminal continued during the week. Excavation of the pipe was completed, piles have been driven for pipeline support and work has begun on reinstating the pipeline connection. All work is being carried out in compliance with the rigorous safety and environmental constraints of the plant owners and their contractors, who, during the last week, supplied ROC with their latest schedule which envisages project completion within two weeks. As soon as the realignment work has been finished, ROC will commission the pipeline for receipt of gas from the Saltfleetby Gas Field. 3. PRODUCTION (ROC 100%) Following the addition of an extra 100 BOPD as a result of working over Welton B22 (see ROC's ASX release dated 17 November 1999), ROC's UK-based Operations Group has identified three other Welton wells and the Keddington-1 well as potential workover candidates. Furthermore, two shut-in Welton wells have also been identified as candidates for recompletion in the shallow Brinsley Abdy oil reservoir. It is expected that these further workover operations will commence during December 1999. Commenting on this onshore UK workover program, ROC's CEO, Dr John Doran stated that: "At first glance, a 100 barrel a day increase in oil production onshore UK would not seem to be particularly exciting. However, it becomes a bit more interesting when viewed in the context referred to below. "For incremental oil produced as a result of successful workover operations at Welton there is negligible leakage of cash flow between the well head and ROC's bottom line. This is because there is virtually no additional capital expenditure nor any extra operating cost of any significance. Also, the UK fiscal regime is extremely supportive of onshore oil producers; a situation which is enhanced by the fact that the relevant interests are held by ROC's wholly-owned UK subsidiaries which have a large amount of applicable tax losses. Any benefit which ROC derives from a successful workover operation at Welton is also accentuated by a number of other factors: ROC owns 100% of the asset; the current oil price for the extra oil production is around US$26 / bbl (equivalent to A$41 / bbl) and none of it is part of any forward hedging programme. "If ROC wanted to replicate, in another part of the world, the net cash flow benefit which it receives by producing additional oil, say 100 BOPD, from a workover at Welton, it would have to achieve significantly higher production rates. For example, if ROC, or any similar company, had an interest level more typical of international joint ventures, say 20%, in a new oil producing well in the Zone of Co-operation in the Timor Sea, the net cashflow effect referred to above would only be replicated if the relevant well produced in the order of 2500 BOPD - and then only if the 20% was totally free carried through the drilling, development and production phases. "The above comparison should not be pushed too far but it does illustrate that the key measurement for an oil company is not the number of barrels that it adds to its production base but rather the number of extra dollars that make their way to the company's bottom line. This is why ROC has spent the last few months reviewing the potential for workovers and recompletions within its onshore UK properties. If the initial success that this programme achieved at Welton B22 can be replicated in other parts of ROC's UK acreage, there should be a proportional increase in cashflow benefit to ROC. It must be emphasised, however, that there is no guarantee that this level of initial success can be maintained or repeated at other Welton well locations." DR JOHN
DORAN For further
information please contact: |
WEEKLY ACTIVITIES UPDATE (17/11/99) |
|
1. SALTFLEETBY GAS FIELD DEVELOPMENT (ROC 100%) The re-alignment work on the small portion of the pipeline which enters the Theddlethorpe Gas Processing Plant continued during the week. Excavation confirmed that neither the pipeline nor the anchor block have been damaged by the minor soil settlement which occurred in late October (see ROCıs ASX release 20 October 1999). The re-alignment work is expected to be completed by end November and first gas is expected to be produced immediately thereafter. Commenting on the Saltfleetby Gas Field development, ROCıs Chief Executive Officer, Dr John Doran, stated that: "The Theddlethorpe Gas Plant, with a capacity in the order of 3 billion cubic feet of gas per day, receives gas from more than 30 North Sea gas installations. The plant is one of the largest in Britain and is, for example, about three times the size of the Longford Gas Processing Plant in Victoria. Therefore, it is very understandable that all relevant parties - the plant owners, their contractors and ROC - want to ensure that the minor re-alignment work being carried out within the confines of the Theddlethorpe Plant, is conducted according to the very highest industry safety and environmental standards. While ROC shares this view, the company does experience a somewhat higher degree of frustration than the other relevant parties due to the fact that this, relatively minor, task is the only outstanding work which needs to be completed prior to start-up of gas production from the Saltfleetby Field." 2. SEISMIC 2.1 Bradley Seismic Survey (ROC 100%) Some 17km of the 20km 2D seismic survey through the seaport town of Grimsby in eastern England has been completed. This survey included recording along the beach and around the sea front pier of the town. Commenting on ROCıs recent seismic activity, ROCıs CEO, Dr John Doran stated that: "In a little more than three months since its initial public offering in Australia, ROC has operated and completed four seismic surveys, three in eastern England and one in Mongolia, all of which were funded 100% by the company. ROC has also been a key participant in the acquisition of a shallow water seismic survey in the offshore Perth Basin. These five surveys, involving the acquisition of 1679 km of 2D seismic and 55 sq km of 3D seismic together with other surveys conducted earlier when ROC was a private company, are expected to lead to an active drilling programme in 2000. Subject to finding a suitable industry co-venturer, it is intended that some of the exploration wells ROC hopes to drill next year will be in the East Gobi Basin of Mongolia where ROCıs seismic has identified several large structural leads (Attachment-1)" 3. PRODUCTION 3.1 Onshore UK During October, ROCıs onshore UK oil production totalled 72,342 barrels (average 2,334 BOPD), 10 BOPD up on the average for the previous month. October production was essentially in line with ROCıs revised internal forecast, being less than the Prospectus forecast for reasons detailed in ROCıs September Quarterly Report to ASX and the companyıs various Weekly Activities Update. A successful workover recently carried out on Welton B22 has resulted in an increase of 100 BOPD from that well. The operation installed a gas anchor, positioned to aid downhole separation of gas and oil. Further opportunities are being evaluated to carry out similar installations at other wells in the field. 3.2 UK North Sea October production from ROCıs UK North Sea assets totalled 4745 barrels (average 153 BOPD), essentially unchanged from the previous month and generally in line with Prospectus Forecast. 3.3 Mongolia (ROC 100%) During October ROC continued to produce oil from three wells in the Zuunbayan and Tsagaan Els Oilfields in the East Gobi Basin of Mongolia. Total production for October was 4571 barrels (average 147 BOPD), down 34 BOPD from the previous month. As a result of its continuing production operations, ROC now has approximately 8,000 barrels of oil in storage in Mongolia. The company expects to modestly increase the amount of oil in storage over the next several months ahead of the possible resumption of its periodic export and sale of oil to China in mid-2000. DR JOHN
DORAN For further
information please contact: |
WEEKLY ACTIVITIES UPDATE (10/11/99) |
|
1. SALTFLEETBY GAS FIELD DEVELOPMENT (ROC 100%) The Saltfleetby Development Project is ready for first gas production except for work to re-align the pipeline connection at the Theddlethorpe Gas Terminal. It was previously reported that the re-alignment is required due to minor soil settlement at the point where the pipeline enters the Terminal. Work has begun on sheet piling and trenching to excavate the buried pipeline prior to re-alignment. It is still expected that first gas will flow from the Saltfleetby Field during late November. 2. SEISMIC ACTIVITY (ROC 100%) 2.1 Onshore UK - Grimsby (PEDL033) Recording of a 14 km exploration 2D seismic grid through the town of Grimsby is due to start on 10 November. The initial phase of recording will be during the night due to traffic restrictions. The survey is designed to investigate the presence of a gravity-associated structure at the northern edge of the Humber Basin. The Saltfleetby Gas Field is located in a comparable position on the southern edge of the Humber basin. DR JOHN
DORAN For further
information please contact: |
