LOCAL OIL/GAS PRODUCER WITH 80pc OF ASSETS IN AUST, ASIA Sydney...

LOCAL OIL/GAS PRODUCER WITH 80pc OF ASSETS IN AUST, ASIA

Sydney - Friday - January 15: (RWE Aust Business News)
******************************************************

OVERVIEW
********

Roc Oil Company Ltd's (ASX:ROC) assets are spread across four
geographic regions - Australia, China, Africa and UK.
The company is predominantly focused on Asia and Australia, with
Australian and Chinese assets providing around 80 per cent of production
and 2P Reserves.
This week the company released its latest operational update and
2009 production report for Roc-operated production assets where
significant activities occurred during late 2009.
These include completion of the dry docking and return to
operation of the Crystal Ocean FPSO at the Basker-Manta-Gummy (BMG)
project, completion of the CH-10 workover at the Cliff Head oil field,
and commencement of the 2010 drilling program at the Zhao Dong oil field.
The Crystal Ocean FPSO and Basker Spirit tanker returned to the
BMG field in late November following a maintenance and vessel survey
program, during which a flare gas compressor (FGC) package was
successfully installed.
The maintenance, vessel survey and FGC installation programs were
completed within budget but approximately two weeks behind schedule,
primarily due to additional work to meet maintenance and statutory survey
requirements.
Basker-2 (B2) sub-sea repairs and inspections were successfully
completed while BMG was offline. Basker-7 development well production
tests were completed across four reservoir zones during December with a
maximum individual zonal rate of approximately 1,000 BOPD.
The optimisation of production from four wells (B2, B3, B7 and
Manta-2A) is continuing.
Current field production is approximately 6,000 BOPD.
Participating interests in the BMG project are Roc Oil (Vic) Pty
Limited, operator 30 per cent; Beach Energy 30 per cent; CIECO
Exploration and Production (Australia) Pty Ltd 20 per cent; Sojitz Energy
Australia Pty Ltd 10 per cent; Pertamina Hulu Energi Australia Pty Ltd 10
per cent.
At the Zhao Dong oil field, offshore China, Roc Oil (Bohai)
Company, a wholly owned subsidiary of Roc, advises that the average daily
Zhao Dong production rate for 2H 2009, which includes the Extended Reach
Area (ERA) (ROC: 24.5 per cent) and C-4 unitised fields (ROC: 11.575 per
cent), is expected to be approximately 18,900 BOPD.
Zhao Dong production in December averaged approximately 9,130
BOPD,having been affected by intensive well maintenance activities,
ongoing repairs to a failed sub-sea power cable between Zhao Dong and C-4
platforms and a requirement to comply with the 2009 annual production
plan.
Ongoing severe weather also experienced since late December
continues to affect production, with interruptions to crude oil shipments
constraining production in January.
Production rates are anticipated to return to approximately
20,000 BOPD by the end of January. Production in 2010 is targeted at
meeting or exceeding 2009 performance.
The 2010 drilling program has commenced with workovers from the
C-4 platform.
The program includes 19 new production wells and five injection
wells.
Plans for 2010 also include the installation of a gas pipeline
and the initiation of gas export sales that will eliminate the need for
gas flaring during normal operations.
Participating interests in Zhao Dong C and D and ERA Oil Fields
are Roc Oil (Bohai) Company 24.5 per cent PetroChina Company 51 per cent,
New XCL-China 24.5 per cent.
Participating interests in the unitised C-4 field are: Roc Oil
(Bohai) Company, Operator 11.58 per cent, PetroChina Company, 76.85 per
cent New XCL-China 11.58 per cent.
Cliff Head Oil Field, Offshore Perth Basin Roc Oil (WA) Pty Ltd,
a wholly owned subsidiary of Roc, advises that a workover to replace the
electric submersible pump (ESP) at the CH-10 production well was
completed in December and the installation of a new ESP at the CH-6
production well is nearing completion.
Following the installation of the larger ESP in CH-10 the Cliff
Head oil field production rate has improved to approximately 5,000 BOPD,
with further well optimisation activity in progress.
Participating interests in the Cliff Head Oil Field are Roc Oil
(WA) Pty Limited, Operator 37.5 per cent, AWE Ltd 57.5 per cent; CIECO
Energy Australia Pty Ltd, 5 per cent.
The average production rate for 2009 is expected to be
approximately 10,000 BOEPD.
Finalised 2009 production figures will be provided in the 4Q 2009
activities report, which will be released on January 28.

SHARE PRICE MOVEMENTS
*********************

Shares of Roc Oil yesterday closed steady at 70c. Rolling high
for the year is 98c and low 30c. The company has 713.1 million shares on
issue with a market cap of $499.2 million.
One of the big wins for the company has been to attract top
energy manager Ron Morris, who joined the company in September 2008 as
General Manager, Beibu Operations.
He was appointed President, Roc Oil (Bohai) Company on August 1,
2009.
Mr Morris has over over 30 years of international experience
and worked 7.5 of the last 11 years in China.
He also led upstream businesses in China and Burma and worked in
Angola, Colombia, North Sea, Europe and North America.
Mr Morris has extensive operational experience with new and
existing fields and prior to joining Roc, was director of special
projects and transition services at Momentum Energy.
He is a member of the International Society of Petroleum
Engineers (SPE) and past chairman of Aberdeen, Shekou (China) & Beijing
Sections.
Roc Oil believes it has strengthened relationships with its
Chinese partners, and is currently negotiating a proposed sale of its gas
to PetroChina.
All available associated and commercially viable free gas
estimated potential of 8 BCF of associated gas (up to 10 BCF of free gas)
will be the first gas export planned for 2H 2010.
Development cost is $US3 million for additional facilities on the
platform and pipeline to be built by PetroChina.
The gas price has been agreed in principle with PetroChina
There will be a rapid payout on gas sales (1-2 years) with
potential incremental oil production from high GOR wells.
Roc believes it will enhance its relationship with PetroChina
over the deal.
It says a longer-term China vision and future growth plan should
leverage Chinese relationships and performance to gain new projects.
Looking at the Beibu Gulf joint venture partners, it is assumed
the Chinese Government will elect to participate in the development, the
interests will be CNOOC (Chinese National Offshore Oil Company) 51 per
cent, Foreign JV Partners 49 per cent (Roc Oil (China) Company 19.6 per
cent Operator, Horizon Oil Ltd 14.7 per cent, Petsec Petroleum LLC 12.25
per cent and Oil Australia Pty Ltd (Majuko Corp) 2.45 per cent).

BACKGROUND
**********

Roc Oil Company Ltd is one of Australia's leading independent
upstream oil and gas companies.
It was incorporated in Australia, and listed on the Australian
Stock Exchange in 1999.
The company currently has about 713 million shares on issue.
The Sydney-based producer/explorer has a strong operating
emphasis, an international focus and a global workforce of about 180.
Roc's value drivers include:
* Proven team with strong technical, operational and financial
abilities;
* Balanced and diversified asset portfolio;
* Exploration in established and frontier regions;
* Pipeline of multiple development projects; and
* Six existing production assets.
Although Roc's assets are spread across four geographic regions,
the company is predominantly focused on Asia and Australia, with
Australian and Chinese assets providing around 80 per cent of production
and 2P Reserves.
Roc constantly evaluates the cost effective development and
acquisition of new and existing exploration and production assets.
Its preference is to take meaningful interests of between 30-40
per cent in such assets, preferably as operator.
Roc utilises established relationships with partners, governments
and national oil companies to identify and develop opportunities - Roc
operates for PetroChina, CNOOC and Sinochem.
Roc is operator of the following production assets: the Cliff
Head oil field, offshore Perth Basin, Western Australia, the BMG oil and
gas fields, Bass Strait, the Zhao Dong C&D oil fields and C4 oil field,
Bohai Bay, offshore China.
Roc is also the operator of exploration and appraisal assets in
offshore Perth Basin, Beibu Gulf, and two offshore blocks in the
Mozambique Channel.
Roc successfully completed a merger with Anzon Energy Ltd in
September 2008 and an off-market takeover of Anzon Australia Ltd in
October 2008.
ENDS rx

Copyright 2010 RWE Australian Business News. All rights reserved.