OKLAHOMA CITY, Oct. 16 /PRNewswire-FirstCall/ -- Devon Energy
Corporation (NYSE: DVN) today announced that it has signed a long-term
contract with Seadrill Offshore AS to utilize the West Sirius
semi-submersible drilling rig in the Gulf of Mexico. The initial contract
term with Seadrill is four years. Devon has the option to extend the term
to five or six years. The company's total commitment under the terms of the
four-year contract is approximately $690 million.
The West Sirius is designed to drill to 37,500 feet in up to 10,000
feet of water and capable of drilling any prospect in Devon's deepwater
inventory. The rig is currently under construction and is scheduled for
delivery from Singapore in the second quarter of 2008.
Prior to entering into the West Sirius contract, Devon entered into a
four-year contract on Diamond Offshore's Ocean Endeavor deepwater drilling
rig. The Ocean Endeavor is being refurbished in Singapore and is scheduled
to arrive in the Gulf of Mexico in the second quarter of 2007. The Ocean
Endeavor is capable of drilling to 35,000 feet in 10,000 feet of water.
"This second long-term rig agreement reflects our growing confidence in
the value of Devon's deepwater Gulf of Mexico position. Our successful
lower Tertiary exploration program, progress toward commercialization and
strong prospect inventory present us with an extensive set of deepwater
Gulf of Mexico drilling opportunities," said Stephen J. Hadden, senior vice
president, exploration and production. "With two deepwater rigs under
contract we will have additional capacity and flexibility to test, appraise
and develop multiple prospects in the lower Tertiary and Miocene trends."
Lower Tertiary Potential to Drive Deepwater Drilling
Devon has to date made four important discoveries in the Gulf of
Mexico's deepwater lower Tertiary trend. The company has recently announced
several developments concerning these discoveries.
On September 5, 2006, Devon announced the results of a production test
of the Jack #2 well. This test was a significant step forward in
determining the commerciality of the Jack discovery and, potentially, other
projects in the trend. Jack #2 sustained flow rates of more than 6,000
barrels of oil per day. The tested interval was approximately 40 percent of
the total net pay measured in the well. Devon and its co-owners plan to
drill another appraisal well on the Jack prospect in 2007. Devon has a 25
percent working interest in Jack.
On August 15, 2006, the company announced plans to conduct additional
drilling and commence production from the Cascade discovery in late 2009.
Devon also announced that it had increased its working interest in the
Cascade Unit from 25 percent to 50 percent.
Additionally, on August 31, 2006, Devon announced a discovery on the
Kaskida prospect. Appraisal drilling on Kaskida and on the previously
announced St. Malo discovery is also planned. Devon has a 20 percent
working interest in Kaskida and a 22.5 percent working interest in St.
Malo.
"Our growth strategy in the deepwater Gulf was to build a strong
exploration portfolio through lease sales, joint ventures and
acquisitions," added Hadden. "Execution of this strategy has resulted in
four discoveries and 19 additional lower Tertiary prospects, six of which
we operate. We have also identified 16 Miocene prospects, five operated by
Devon. These opportunities represent resource potential that could more
than double the company's current reserve base."
Devon Energy Corporation is an Oklahoma City-based independent energy
company engaged in oil and gas exploration, production and property
acquisitions. Devon is one of the world's leading independent oil and gas
producers and is included in the S&P 500 Index. For additional information,
visit http://www.devonenergy.com .
This press release includes "forward-looking statements" as defined by
the Securities and Exchange Commission. Such statements are those
concerning strategic plans, expectations and objectives for future
operations. All statements, other than statements of historical facts,
included in this press release that address activities, events or
developments that the company expects, believes or anticipates will or may
occur in the future are forward- looking statements. Such statements are
subject to a number of assumptions, risks and uncertainties, many of which
are beyond the control of the company. Statements regarding future
production and resource potential are subject to all of the risks and
uncertainties normally incident to the exploration for and development and
production of oil and gas. These risks include, but are not limited to,
inflation or lack of availability of goods and services, environmental
risks, drilling risks and regulatory changes. Investors are cautioned that
any such statements are not guarantees of future performance and that
actual results or developments may differ materially from those projected
in the forward-looking statements.
SOURCE Devon Energy Corporation
 back to top
Related links:
http://www.devonenergy.com
http://www.prnewswire.com/comp/118040.html /
CONTACT:
investors, Zack Hager, +1-405-552-4526, or
media, Brian Engel, +1-405-228-7750, both of Devon Energy
Corporation
|
