Unocal farms in to Donggala PSC offshore Indonesia; outlines drilling program on deepwater prospects
El Segundo, Calif., Jan. 28, 2003 - Unocal Corporation (NYSE: UCL) today said its Unocal Donggala Limited subsidiary has reached agreement to farm in to the deepwater Donggala production-sharing contract (PSC) area offshore East Kalimantan, Indonesia.
Unocal Donggala will acquire a 19.55-percent working interest in the PSC. TotalFinaElf, the operator, Pertamina, and Inpex Corp. hold the balance.
The Donggala PSC area lies outboard of the Rapak PSC area where Unocal is operator and holds an 80-percent working interest. Unocal has made several discoveries on Rapak, including the deepwater Ranggas and Bangka fields. Water depth on Donggala ranges from 6,000 to 8,000 feet.
The farm-in is subject to final approval by the Indonesian government.
Unocal and ENI-Lasmo Indonesia Limited (Eni) also announced the award of the Muara Bakau PSC area, located offshore East Kalimantan and inboard of the company's Gula and Gendalo discoveries. Unocal will have a 50-percent working interest in the PSC. Eni will be the operator and hold the remaining working interest. Water depth on Muara Bakau ranges from 250 to 4,500 feet. The Muara Bakau PSC has a two-well commitment in the first year of the PSC.
2003 exploration program
Unocal will resume deepwater exploration drilling in Indonesia in mid-March 2003. Sixteen wells, including 7 new field wildcats, are expected to be drilled during 2003. TotalFinaElf will operate two of the wells utilizing the Transocean's Sedco 601 drill rig.
Unocal also expects to complete a contract soon for a fifth-generation semi-submersible rig that will be used to drill a series of deeper horizon wells offshore East Kalimantan in 2003.
Deep horizon drilling program
The new drilling rig will give Unocal the ability to drill several thousands feet deeper than previously possible; below existing gas/oil discoveries at Ranggas-Gehem, West Seno, Sadewa, Merah Besar and Gula. The deep horizon program is designed to test deeper reservoir section, under or adjacent to known accumulations, for additional oil pay. Oil was encountered in two sands below a major gas accumulation in the Sadewa-1 well, but the primary reservoir targets could not be reached with Sedco 601 rig.
About Unocal Corporation
Unocal is one of the world's leading independent natural gas and crude oil exploration and production companies. The company's principal oil and gas activities are in North America and Asia.
This news release contains certain forward-looking statements about Unocal's future drilling plans and expectations for government approvals. These statements are not guarantees of future performance. The statements are based upon Unocal's current expectations and beliefs and are subject to a number of known and unknown risks and uncertainties that could cause actual results to differ materially from those described in the forward looking statements. Actual results could differ materially as a result of factors discussed in Unocal's amended 2001 Form 10-K/A and subsequent reports filed with the Securities and Exchange Commission. Copies of the company's SEC filings are available from the company by calling 800-252-2233. The reports are also available on the Unocal web site, www.unocal.com.
Under the terms of the production-sharing contracts, Unocal subsidiaries are contractors to Indonesia government agencies, and are entitled to varying shares of the oil and gas produced from commercial discoveries.
Updated: January 2003