Rivalling the company's highly prized Neptune-5 success in the GoM earlier this year Shenzi-2 is located on Green Canyon Block 653 with the BHP Billiton operated drillship CR Luigs.

Located in water depths of 4,238 feet and drilled to a total depth of 25,500 feet, the well encountered approximately 500 feet of net oil pay in a 1,250 foot gross hydrocarbon column of lower Miocene reservoir sandstones.

Phil Aiken, CEO of BHP Billiton Petroleum said today, "We have drilled a successful appraisal well on one of our operated discoveries, and this well result, with excellent quality reservoirs that were appreciably thicker than those encountered in the first Shenzi well, has significantly extended the scale of the oil accumulation discovered by Shenzi-1.

"The discovery is located along the same geologic trend as our Mad Dog, Atlantis and Neptune fields, and whilst further appraisal drilling will be required to fully define the reserve size, we will be working with our partners to begin studying possible development options," said Aiken.

Following well logging operations and other data collection activities, the partners are planning to drill a sidetrack out of the existing well bore.

Shenzi-2 is located approximately two miles southwest of the discovery well Shenzi-1, which originally encountered a gross hydrocarbon column of 465 feet with 140 feet of net pay.

BHP Billiton's exploration and development portfolio in the Gulf of Mexico includes the development of the Mad Dog (BHP Billiton share 23.9%) and Atlantis (BHP Billiton share 44%) fields that are due to start production in 2005 and 2006 respectively, and a full appraisal program on its operated discoveries at Neptune, Vortex, Cascade, and Chinook.

BHP Billiton is the operator at Shenzi and holds a 44% interest in the field with US based Amerada Hess and BP each hold 28% interest.