Anadarko Sanctions Lucius Project

abarrelfullabarrelfull wrote on 26 Feb 2013 14:41

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Dec 15, 2011

Anadarko Petroleum Corporation (NYSE: APC) announced that it, along with its co-venturers, have sanctioned the development of the Lucius project, located in the Keathley Canyon area of the deepwater Gulf of Mexico.

"We are very pleased to achieve this important milestone in the development of the deepwater Lucius project," said Anadarko President and Chief Operating Officer Al Walker. "We expect Lucius to be among the most economic projects in our portfolio, as we plan to utilize 'off-the-shelf' technology and leverage our proven project-management skills in an area where we have extensive expertise. We estimate the Lucius unit holds more than 300 million BOE (barrels of oil equivalent) with relatively shallow and highly productive reservoirs that can be developed in a capital-efficient manner. Once completed, Lucius will establish important infrastructure in an emerging area of the Gulf of Mexico where we have identified additional prospects and opportunities. We expect to have an active drilling program in the unit beginning in 2012, and we look forward to working with our partners to achieve first production in 2014."

Lucius will be developed with a truss spar floating production facility with the capacity to produce in excess of 80,000 barrels of oil per day and 450 million cubic feet of natural gas per day. The spar is currently under construction at Technip's facility in Pori, Finland and will be the largest of Anadarko's operated spars — a deepwater production solution pioneered by the company in 1997.

The Lucius unit includes portions of Keathley Canyon blocks 874, 875, 918 and 919. Anadarko operates the unit with a 35-percent working interest. Following the previously announced unitization agreement, Lucius interest owners entered into an agreement with the Hadrian South co-venturers, whereby natural gas produced from the Hadrian South field will be processed through the Lucius facility in return for a production-handling fee and reimbursement for any required facility upgrades.

Co-venturers in the Lucius unit include Plains Exploration & Production Company (NYSE: PXP) with a 23.3-percent working interest; Exxon Mobil Corporation (NYSE: XOM) with a 15-percent working interest; Apache Deepwater LLC, a subsidiary of Apache Corporation (NYSE: APA) (NASDAQ: APA) with an 11.7-percent working interest; Petrobras with a 9.6-percent working interest; and Eni with a 5.4-percent working interest.

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