press release

Horizontal wells boost Unocal's Indonesia gross oil production by 30,000 barrels per day

El Segundo, Calif., April 16, 1997 -- Unocal Corporation said today that its successful horizontal well drilling program in East Kalimantan, Indonesia, now accounts for more than 30,000 barrels per day of oil production.

"Horizontal wells have been an important tool in increasing the reserves, production and profitability of our Indonesian operations," said Muchlis Sjadzali, vice president of operations for Unocal Indonesia Company. He noted that the company is employing innovative drilling and production technology to continually improve Unocal's operations in Indonesia.

"This horizontal well drilling program has not only helped offset the natural decline in production rates, but has helped increase total production from the fields," Sjadzali said. The company expects that gross daily production (including host country share) from its Indonesia fields during 1997 will be more than 10 percent above levels last year, averaging more than 100,000 barrels of oil and 255 million cubic feet of gas.

Unocal Indonesia has drilled horizontal wells in three fields it operates under a production-sharing agreement with Pertamina, the Indonesian national oil company.

In the Attaka field, the latest horizontal well, L-23, encountered 1,200 feet of oil pay in the horizontal section below 3,100 feet. Daily production from the L-23 well is about 2,000 barrels of oil and 4.5 million cubic feet of gas.

L-23 is the twelfth horizontal well drilled in the Attaka field, and the sixth drilled into shallower sands where successful completions were difficult because of geologic conditions. Horizontal wells now account for 21,500 barrels of oil per day of production from Attaka. The company expects to drill 11 additional horizontal wells in the field this year.

In the 20-year-old Yakin field, a recent horizontal infill well, YC-4HZ, in the center of the field encountered 870 feet of horizontal oil pay and produced at 1,100 bopd. Two horizontal wells drilled so far in the Yakin field have added production of 1,400 bopd. Ten more horizontal development wells are planned for the Yakin field this year.

Five horizontal wells drilled in the Serang field now account for 6,800 bopd. Unocal said it expects to drill six additional wells in the Serang field during 1997.

Unocal, as operator, has a 50 percent working interest in the Attaka Unit. The company has 100 percent working interests in the Yakin and Serang fields. Unocal also has 100 percent working interests and operates five other fields in Indonesia -- Sepinggan, Melahin, Kerindingan, Seguni and Pantai.

Unocal is the world's largest independent exploration and production company with reserves of more than 9.8 trillion cubic feet of natural gas equivalent (1.6 billion barrels of oil equivalent) and major oil and gas production activities in Asia and the U.S. Gulf of Mexico.

Updated: April 1997