Unocal starts gas production from Muni field; new field to add 120 mmcfd of new production by year end
Sugar Land, Texas, Oct. 9, 2000 - Unocal Corporation (NYSE: UCL) today said its Spirit Energy 76 business unit has brought the Muni discovery on production ahead of schedule and under budget and expects production to exceed 120 mmcfd by year end.
One well is producing, and two additional wells will be flowing natural gas by the end of October. Muni is one of the largest natural gas discoveries made in the Gulf of Mexico Shelf in recent years, with a gross resource potential of 100 to 160 billion cubic feet. Unocal holds a 100-percent working interest in this new field.
"The Muni development demonstrates our ability to make significant reserve additions in the mature GOM shelf and rapidly capitalize on the improved price environment," said Timothy H. Ling, Unocal executive vice president for North American Operations.
"The first production at Muni comes just 10 months after the field was discovered in December 1999. This kind of performance illustrates the competitive advantage that we have in our people and the culture they have created," Ling said.
The company acquired the Ship Shoal 295 lease in OCS lease sale 172 in March 1999.
Spirit Energy commissioned a project team to work on a fast-track development of the field in order to benefit from rising natural gas prices.
Unocal made the decision to move ahead with the development in March 2000, and the company awarded contracts to design and fabricate production facilities in time for a planned December 2000 startup.
The platform, facilities and export pipeline were installed and tested in August, approximately two months ahead of schedule. Unocal expects that project development costs for the Muni development through 2000 will total less than $50 million.
About Unocal Corporation
Unocal is one of the world's leading independent natural gas and crude oil exploration and production companies. At year-end 1999, the company had worldwide natural gas reserves of 6.6 trillion cubic feet, representing two-thirds of the company's overall hydrocarbon reserves. In North America, Unocal is one of largest independent natural gas producers, with current net production of 1 billion cubic feet per day.
This news release contains certain forward-looking statements about Unocal's production rates, resource potential, reserves, capital expenditures and drilling plans. 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 1999 Form 10-K report filed with the Securities and Exchange Commission. Unocal undertakes no obligation to update the information in this news release. Cautionary note to U.S. Investors -- The U.S. Securities and Exchange Commission permits oil and gas companies, in their filings with the SEC, to disclose only proved reserves that a company has demonstrated by actual production or conclusive formation tests to be economically and legally producible under existing economic and operating conditions. Unocal uses certain terms in this news release, such as resource potential, that the SEC's guidelines strictly prohibit us from including in filings with the SEC. Resource potential is a speculative estimate of ultimate recovery based on engineering, geophysical, and geological studies and may include market risk.
U.S. investors are urged to consider closely the disclosure in Unocal's 1999 Form 10-K.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.
Updated: October 2000