parsons

The Beach Petroleum annual report today has some great references to the joint ventures with COE and what BPT expect out of them.
Excerpts as follows:

"We expect that the new Parsons oil field will add conservatively well over a million barrels of recoverable oil reserves. It has a reservoir quality that our technical experts regard as excellent –better possibly than the recent very productive Callawonga wells that flowed in excess of 5000 barrels of oil per day.
It means that the new Callawonga pipeline’s role as a trunkline from the West Patchawarra Flank directly to markets is now assured and the cost per barrel for transport will be now reduced markedly.
It means that we have made a sound investment in establishing new infrastucture –and I am delighted!

We may –like Caesar with Gaul -divide the Cooper-Eromanga region into two operating areas, straddling the Queensland-South Australia border.
In the central area are numerous oil and gas fields operated on behalf of the Cooper Basin Joint Venture by Santos Limited.
Around the flanks, notably at Kenmore-Bodalla in Queensland and on the West Patchawarra Flank in SA are areas where Beach operates on behalf of itself and other joint venturers. These, for reasons of geology, are areas that are more oil prone.

Cooper oil production is highly profitable –particularly at the present level of around USD100 per barrel.
A snapshot of Financial Year ’07 production shows that we realised an average price of AUD86.45. After deducting the costs of production, transport and royalties, free cash flow per barrel was AUD53.73.
Even if the oil price were to fall significantly, profitability remains robust down to what one must now regard as implausibly low levels.

In the Beach-operated areas, apart from continued Cooper Oil Program style operations in existing fields, our thrust is to expand exploration, particularly in the now proven West Patchawarra Flank.
This is higher risk, because it involves stepping out into the unknown, but the oil production that can result should be highly profitable, based on our experience to date, and assisted by new pipelines for delivery to markets.
Applying higher levels of risk, we believe that we can add at least 5 mmb to Beach’s reserves over 3 to 5 years from these operations –delivering NPV of AUD200 million or more at present prices.