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Noble Takes Interests in BP's Deepwater Atwater Valley GOM Prospects

Noble Energy Inc. is buying into 17 leases owned by BP Exploration & Production Inc. in the promising Atwater Valley (AV) region of the deepwater Gulf of Mexico (GOM), an area that drew some big spenders in the March federal lease sale.

The Houston-based explorer is taking a half-stake in 13 AV leases and an average 26% interest in four other leases. In exchange, Noble is giving BP a half-share of its Bright prospect in AV Block 362, which is being drilled at a water depth of about 5,600 feet. The initial well, targeting multiple Upper and Middle Miocene reservoirs, is to be drilled to a total depth of 13,500 feet.

BP today is said to be the largest rig operator in the deepwater; in April it had a record nine rigs in operation (see Daily GPI, April 16).

"The deepwater Gulf of Mexico is one of Noble Energy's core areas and today we have expanded our opportunity set there through the successful capture of a number of attractive and sizeable prospects," said Senior Vice President Susan M. Cunningham, who runs the GOM, West Africa and Frontier unit. "We have multiple opportunities for substantial hydrocarbon discovery in the near-term," with the Bright prospect expected to reach total depth by the end of September.

Noble is estimating the Bright prospect has 90-350 million boe of gross unrisked resource.

At the Central GOM Lease Sale 231 in March, one block in Atwater Valley (198) drew six bids, the most for the sale, from well seasoned deepwater explorers that included Freeport-McMoRan Copper & Gold Inc. and ExxonMobil Corp. (see Daily GPI, April 24; March 19).

Noble isn't going it alone in all of its GOM prospects, with some private equity support from Ridgewood Energy Corp. The upstream investor is helping to finance Noble's Dantzler project in the deepwater (see Daily GPI, Jan. 13). Wireline logging data indicated last December that the well encountered more than 120 feet of net pay in two Miocene reservoirs in Mississippi Canyon Block 782. Discovered gross resources are estimated at 55-95 million boe.

Noble currently is drilling a second well at Dantzler "as we progress multiple major projects toward first production," said Cunningham. Noble has worldwide development, with core U.S. operations primarily in GOM, and in the Denver-Julesburg Basin and Marcellus Shale.

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