HOUSTON, Dec. 21 /PRNewswire/ -- Ocean Energy (NYSE: OEI) announced today
that its board of directors has approved a capital investment program of
approximately $500 million for the year 2000. The spending will be funded
from Ocean's discretionary cash flow based on anticipated commodity prices,
and is subject to change if market conditions shift or new opportunities are
identified.
"Ocean has one of the most promising inventories of opportunities among
U.S. independent oil and gas companies," said James T. Hackett, President and
Chief Executive Officer. "After completing the merger of Ocean and Seagull
Energy this year and surpassing our targets to reduce debt and costs, we are
eager to demonstrate our exploitation and exploration capabilities during
2000."
The projected 2000 program represents a 40 percent increase over 1999
anticipated spending of $356 million. Of the budget, currently 40-50 percent
is allocated to Gulf of Mexico projects, 30-35 percent to international
spending, and 15-20 percent to U.S. onshore programs. Exploration activities
currently comprise approximately 35 percent of the amount.
Gulf of Mexico
In the Gulf of Mexico, Ocean plans to grow its reserve base through
delineation of recent discoveries and additional deepwater exploration while
pursuing select opportunities on its inventory of core shelf holdings. Some
$200 - $250 million is currently planned for expenditures in the Gulf of
Mexico, approximately 50 percent to shelf drilling and 50 percent to
deepwater.
Ocean's deepwater expenditures will include continued development of its
commercial discoveries in the East Breaks area. Along with its partners, OEI
has drilled discovery wells at East Breaks 602, 642 and 643, and a successful
appraisal well was recently completed on the Nansen prospect in East Breaks
602. Ocean holds a 50 percent interest in the Nansen prospect and a
20 percent interest in the North and West Boomvang complex of East Breaks
642 and 643. The company and its partners are currently drilling the Nansen
#3 well on East Breaks 602 and the North Boomvang #3 well on East Breaks 643.
International
On the international front, Ocean has allocated $150 - $175 million to a
number of high profile exploratory and high impact development wells. Of that
amount, approximately 35 percent will be targeted to development activities in
the Zafiro Field on Block B in Equatorial Guinea. Installation of the Jade
platform is currently underway where six to eight wells are planned next year.
Also in Equatorial Guinea, Ocean and its partners anticipate the drilling of
an exploratory well on Block C, where it holds a 37 percent working interest.
In deepwater Angola, Ocean and it partners are pursing high-potential
offshore projects where OEI has a 15 percent working interest in Block 24 and
a 20 percent working interest in Block 19, with plans to begin drilling an
exploratory well on Block 24 during the fourth quarter of 2000. On Block 19,
further seismic evaluation will continue, with drilling slated for late 2000
or early 2001.
In Pakistan, OEI is currently drilling the Pasni #1, an offshore
exploratory well in which it holds 77 percent working interest. Plans call
for further testing and drilling in that area during 2000. Ocean will also
participate in a two-well exploratory drilling program onshore Yemen, with the
first well to spud mid-year 2000.
In addition, the company plans further development of its substantial
interests in Egypt, primarily in the East Zeit concession in the Gulf of Suez.
OEI has interests in six concessions in the country.
U.S. Onshore
Ocean plans to spend $75 - $100 million to primarily enhance production
from its long-life natural gas reserves to meet the demands of the favorable
North American gas market. In addition to drilling approximately
250 development wells, OEI will drill 40 exploratory wells in such core areas
as the Gulf Coast and Permian Basin. The company will also continue to pursue
its development of the Bear Paw field in Montana with the drilling of
approximately 80 wells.
Ocean Energy, Inc. is an independent energy company engaged in the
exploration, development, production, and acquisition of crude oil and natural
gas. North American operations are focused in the shelf and deepwater areas
of the Gulf of Mexico, the Permian Basin, Midcontinent and Rocky Mountain
regions. Internationally, the Company explores for and produces oil and gas
in West Africa (Cote d'Ivoire and Equatorial Guinea), Egypt, Russia and
Indonesia. Ocean Energy also has exploration programs underway in Angola,
Pakistan and Yemen.
Certain statements in this news release regarding future expectations,
plans for acquisitions, dispositions, and oil and gas reserves, exploration,
development, production and pricing may be regarded as "forward looking
statements" within the meaning of the Securities Litigation Reform Act. They
are subject to various risks, such as operating hazards, drilling risks, the
inherent uncertainties in interpreting engineering data relating to
underground accumulations of oil and gas, as well as other risks discussed in
detail in the Company's SEC filings, including the Annual Report on Form 10-K
for the year ended December 31, 1998. Actual results may vary materially.
SOURCE Ocean Energy, Inc.
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http://www.oceanenergy.com
Company News On-Call:
http://www.prnewswire.com/comp/913463.html or fax,
800-758-5804, ext. 913463
CONTACT:
William L. Transier, Executive Vice President
and Chief Financial Officer of Ocean Energy, Inc., 713-265-6161
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