Enterprise Oil Acquires R&B's Gulf Prospects
Enterprise Oil, the largest independent exploration and
production company in Europe, apparently couldn't resist the market
opportunities in the U.S. any longer. The company paid $127.3
million last week for all of drilling company R&B Falcon Corp's
E&P interests in the Gulf of Mexico. The transaction covers a
50% stake in the Boomvang field about 100 miles south of Galveston,
TX, and a major stake in the Gyrafalcon prospect, which is about
100 miles offshore Lousisiana in Green Canyon block 20.
For R&B, it's an opportunity to unload E&P assets at a
time when the market is at a high point. R&B's exploration
efforts have been "very successful over the past year and one-half,
and the...sale partially unlocks the considerable, unrecognized
value we have built there," said R&B Falcon CEO Paul B. Loyd.
Enterprise's activities have been focused in three core areas in
Europe, including the United Kingdom and Ireland; Norway and
Denmark; and Italy. Now the company is turning its sites on the
U.S. Gulf, according to Peter Jackson, president and general
manager of the company's U.S. operations. The former British Gas
subsidiary plans on elevating the Gulf of Mexico to core business
"If you have a billion barrels of reserves, you want to go
somewhere and find probably more than 100 million [to establish a
new core area]," said Jackson. "We're getting between 28 and 33
million barrels of reserves (about 200-350 Bcf of gas reserves)
[with this purchase]. It's a significant building block." Boomvang
has reserves between 70-100 million barrels of oil equivalent, 50%
of which are natural gas. The field is expected to begin producing
in the first half of 2002, using a Spar platform designed for daily
production of 30,000 barrels of oil and 200 MMcf/d of gas.
"There have been a great number of opportunities in the Gulf in
the last 18 months but that market seems to be drying up a little
bit because of favorable pricing," Jackson added. He said
Enterprise intends to maintain its access to four or five
"top-notch exploration prospects" to drill each year or to
participate in each year.
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