This particular permit is just sitting off the coast near Barrow Island (Mermaid Marines Supply Base is close by)
Apache, Santos firm up Halyard plans
Bevis Yeo Monday, 30 August 2010
APACHE Energy and Santos have confirmed plans to develop the Halyard field in WA-13-L, Carnarvon Basin, as a domestic gas project for Western Australia.
Santos said the two companies will complete and tie back the Halyard well and, subject to the outcome of the Spar-2 appraisal well in WA-4-R which will be drilled later this year, will quickly complete and tie back Spar as part of this development.
Halyard is expected to be on-line in mid-2011 at an initial rate of 50 terajoules per day while Spar will follow in 2012, possibly increasing output past 100TJ/d by early 2013.
Recoverable reserves in Halyard and Spar are estimated at about 335 petajoules, enough to supply WA with gas until at least 2025.
There are additional opportunities in the Greater East Spar area.
Halyard and Spar are perfectly positioned to be developed in the near term by tying the gas fields back to the existing gas hub at Varanus Island, Santos vice president Western Australia and Northern Territory John Anderson said.
Santos is pleased to build on its important relationship with Apache in Western Australia, and is confident Halyard and Spar will make a significant contribution to the states domestic gas supply.
As part of the deal, Santos has sold 55% of its interest in Spar to Apache for an initial payment of $US31 million ($A34.4 million), with additional payments of up to $US85 million contingent on the level of certified reserves in Spar following drilling of Spar-2.
This gives Apache a 55% operating stake in both fields, while Santos will hold the remaining 45%.
The deal is subject to regulatory approvals and is expected to close in the second half of 2010.
Apache had said in an environmental proposal filed earlier this month that gas from Halyard would be transported through a 16-kilometre flexible flowline to East Spar, while well control would be achieved through a 28km umbilical from the John Brookes platform.
The Halyard field was discovered in 2008 by the Halyard-1, which flowed at a peak rate of 68 million cubic feet of gas and 936 barrels of condensate per day from 91 feet of net gas pay in the Cretaceous Halyard sandstone.
The well is on trend with the Apache and Santos-held John Brookes Field, which is producing 240MMcf of gas per day from three wells for the WA domestic market.
MRM Price at posting:
$2.35 Sentiment: LT Buy Disclosure: Held
