Company CEO John Doran told a CorporateFile.com.au Open Briefing that the partners were pondering expanding the offshore Western Australian project, scheduled for drilling early next year, to allow it to recover more oil from the field than originally planned.
“Currently, those [one million] barrels are not included in the field’s proved and probably reserves,” said Doran.
“Obviously this increase in scope and budget would only occur if it provided the joint venture with a net economic gain.”
Despite a reserve downgrade and a budget increase earlier in the year, Doran said Cliff Head remained one of Roc Oil’s top priority projects, alongside Chinguetti in Mauritania.
Cliff Head is expected to produce about 4000 bopd in early production.
Doran said Roc’s entire exploration drilling program, including Cliff Head and Chinguetti, would be funded internally, following the sale of the Saltfleetby Gas field in December 2004 and the revenue from a rights issue mid last year.
Over the next six months, Roc hopes to drill up to 11 exploration and appraisal wells in various parts of the world.
Several of these wells, including wells Jacala-1 in the Carnarvon Basin, due to be drilled in January, were high-risk, high-reward category projects.
"Success with any one of them would substantially increase the value of the company,” Doran said.
Other, more modest wells inlcuded several wildcats scheduled for the offshore Perth Basin, starting with Flying Foam – about 230km north of Cliff Head. This would be followed immediately by either Thornhill-1 or Franklin-1, which lie 3km and 25km from Cliff Head respectively.
“The second phase of the offshore Perth Basin exploration drilling program will be woven around the development drilling activities at Cliff Head, which are expected to start in November and run through until March 2006,” said Doran.
He said this later exploration phase could see three additional exploration/appraisal wells drilled from March 2006 into the second quarter.
Wells in the offshore Perth Basin are generally less expensive than elsewhere, costing between A$3 million and A$7 million, said Doran.
“Therefore, although Roc’s equity in these wells is usually 20% to 37.5%, the net cost to Roc is still quite palatable,” he said.
