Exploration

Santa Fe Snyder Corp. of Houston said last week that anexploration well in Howard County, TX,Sellers 119 #1, has beensuccessful, and will extend the company’s Lost Peak area there. Thewell targeted Cisco Canyon sandstones now being exploited in theSignal Peak field six miles northwest of the well. The Sellers wellencountered 115 of gross pay sand with productive gas shows over a200-foot interval. Santa Fe has 80,000 gross acres (60,000 net)under lease in the play, and through the end of this year, expectsto drill an additional 15 development and three exploratory wells.Santa Fe plans to develop the field on 160-acre spacing, withportions of the field on 80-acre spacing. Current plans for 2001call for drilling up to 50 wells there. Gross operated productionfrom the Signal Peak field is now 25 MMcf/d and 1,300 b/d of oil.Cost of finding and development for the area has averaged $.80 perMMcfe, with operating costs of $.30 per MMcfe.

Having set the world’s water-depth record for a combineddrilling and production platform, Exxon Mobil Corp.’s Hoover andDiana fields now are averaging 140 MMcf of gas and 18,000 barrelsof oil per day from five wells, and contain estimated recoverableresources that exceed 300 million oil-equivalent barrels.

Two oil field service titans joined forces last week to create anew seismic oil and gas exploration business, a move that analystssay will reshape the seismic industry. Baker Hughes andSchlumberger have signed a memorandum of understanding under whichSchlumberger’s surface seismic business Geco-Prakla and BakerHughes’ seismic unit Western Geophysical would become Western GECO.

Two oil field service titans joined forces yesterday to create anew seismic oil and gas exploration business, a move that analystssay will reshape the seismic industry. Baker Hughes andSchlumberger have signed a memorandum of understanding under whichSchlumberger’s surface seismic business Geco-Prakla and BakerHughes’ seismic unit Western Geophysical would become Western GECO.

A deep-drilling exploration project in the southwest end of theoil/gas saturated San Joaquin Valley about 45 miles northwest ofBakersfield is moving into the production testing phase with itssponsors, Tri-Valley Oil and Gas, liking what they have seen inpreliminary analyses of the 19,100-foot-deep Project Ekho#1 testwell.

Vastar Resources and Newfield Exploration Co. have selectedWilliams to gather, process and transport nearly 75 MMcf/d ofnatural gas from offshore wells along the Alabama coast. The twoenergy producers are jointly developing reserves in the Gulf ofMexico’s Mobile Bay area, the location where Williams recentlyadded 350 MMcf/d of transportation capacity and a wholly-owned 600MMcf/d processing plant onshore. The Williams plant is located inCoden, AL.

Talisman Energy Inc. and Purcell Energy Ltd. of Calgary formedan exploration joint venture for the greater Fort Liard region inthe southwestern Northwest Territories and southeastern YukonTerritory. The participation right in the joint venture will be 60%for Talisman and 40% for Purcell. “This is Talisman’s firstsignificant move into the Northwest Territories, and we are happyto have Purcell as a partner,” said Talisman CEO Jim Buckee. “Themajority of remaining hydrocarbon potential in Canada lies in themedium and deeper gas plays in Alberta, BC, and the Territories,and Talisman is well positioned as one of the leading deep gasplayers in North America.” “This joint venture strategicallypositions Purcell to leverage its Fort Liard success on SDL 99,”said Purcell CEO Jan Alston. “Talisman’s experience as a successfulfoothills gas explorer combined with Purcell’s long-standinginvolvement at Fort Liard will enable the joint venture partners tocapitalize on opportunities as the area continues to open up.”Preliminary work will commence immediately and be focused on deepgas prospects.

Quicksilver Resources Inc. last week completed a deal acquiring CMS Energy Corp.’s Michigan gas and oil exploration and production properties, including the stock of Terra Energy Ltd., as well as other smaller interests in Ohio, Kentucky, and Indiana. The deal was announced in January (see NGI Jan. 24).

Quicksilver Resources Inc. completed its acquisition of CMSEnergy Corp.’s gas and crude oil exploration and productionproperties in Michigan, including the stock of Terra Energy Ltd.,as well as other smaller interests in Ohio, Kentucky, and Indiana.The deal was announced in January (see Daily GPI Jan. 20).