|
Husky’s first venture in China was the 2002 acquisition of a 40 percent interest in the Wenchang oil fields located in the western Pearl River Mouth Basin, approximately 400 kilometres southwest of Hong Kong and 100 kilometres east of Hainan Island. The Wenchang 13-1 and 13-2 fields are producing from 27 wells in 100 metres of water into a floating production, storage and offloading (FPSO) vessel stationed between fixed platforms.
As of December 31, 2006, the Company’s remaining proved reserves at Wenchang were 13.3 million barrels of crude oil and natural gas liquids. Husky’s production averaged 12,100 barrels per day during 2006.
Husky’s total acreage in the South and East China Seas has grown to over 7.6 million acrees with the acquisition of additional exploration acreage, in August 2006.
In 2004, Husky signed a production sharing contract with the China National Offshore Oil Corporation (CNOOC) for the 29/26 exploration block in the South China Sea. The block, which covers approximately 979,773 acres, is located 250 kilometres south of Hong Kong and has an average water depth of 1,300 metres.
In the second quarter of 2006, the Liwan 3-1-1 exploration well was drilled by Husky on Block 29/26 resulting in a significant hydrocarbon discovery. Liwan 3-1-1, which is the deepest water well drilled offshore China, confirms the existence of a new hydrocarbon province.
In January 2007, Husky signed a three-year contract with Seadrill Off shore AS for the deep water semi-submersible drilling rig, West Hercules, currently under construction in South Korea and scheduled for delivery in the second quarter of 2008. In preparation for the arrival of the West Hercules, the Company shot a 98,867 acre 3-D seismic program over the vicinity of the Liwan discovery. In addition, China Oilfi eld Services Limited has been contracted to aquire 772,396 acres of 3-D seismic data in 2007, over Block 29/26 and a portion of the adjacent Block 29/06.
In August 2006, Husky signed a petroleum contract with CNOOC for three exploration blocks, including Block 29/06. Located in the Pearl Mouth River Basin, adjacent to block 29/26, this block covers an area of approximately 2,289,431 acres at water depths of 500 to 1,500 metres.
In the first exploration phase, Husky has committed to acquiring 123,583 acres of 3-D seismic and drilling two exploration wells within three years. The seismic data will be acquired in 2007 with the seismic program on Block 29/26.
In 2003, Husky completed a 3-D seismic survey shot over 347,105 acres of the block. The Company fulfi lled its Phase I commitments on Block 23/15 with the drilling Wushi 17-1-1 in 2005, which encountered non-commercial oil. Husky has decided to proceed with Phase II of the PSC in which it relinquished 25 percent of Block 23/15 block to CNOOC, and has committed to drilling a second exploration well before December 31, 2007.
Included in the August 2006 petroleum exploration contract with CNOOC, along with Block 29/06, these blocks are located in the Ying Ge Hai Basin, west of Hainan Island. Block 35/18 is Block 35/18 is approximately 1,104,314 acres in area and Block 50/14 covers 725,170 acres. Both of these blocks are in water depths of 120 metres.
The production sharing contract for this block in the East China Sea was signed in 2003. The block covers 1,194,755 acres with water depths of 50 to 75 metres. Geotechnical evaluation of the hydrocarbon potential is complete and Husky expects to drill an exploration well in 2007, contingent on rig availability.
| |
