Contract for Cluster 7 expected this month

Vol 10, PW 10 (07 Sep 06) News in Brief

Prize Petroleum hopes to sign a service contract with ONGC for the offshore Cluster 7 marginal fields on either 20th or 26th September.

The contract has already been initialled, we hear. We are now arranging things for the formal signing.

Prize (10%) will be joint operator with M3nergy of Malaysia (30%) for the three-year initial development phase. Prize parent company refiner Hindustan Petroleum holds 60%.

Before going into the final development phase the asset has to be assessed by an independent consultant, adds a source. We can then continue or walk out.

On present evidence, such a move appears unlikely. Old 3D seismic of the field from ONGC give Prize confidence that Cluster 7 holds 38m barrels of recoverable oil and has a producing life of between 12-15 years of which 10 years will see peak production.

Prize believes Cluster 7 could produce as high as 18,000 to 20,000 b/d for three years. Operating costs are likely to be around $12 per barrel.