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Pioneer Announces Third Discovery on Its Operated Jenein Nord Block in Tunisia and Plans for First Production
DALLAS, Apr 02, 2007 (BUSINESS WIRE) -- Pioneer Natural Resources Company (NYSE:PXD) today announced continued success in its development and expansion programs in Tunisia, including:
-- The third discovery on the Pioneer-operated Jenein Nord Block
-- Plans to develop discoveries on Jenein Nord where the first two wells tested at a combined rate of more than 12,000 barrels of oil equivalent per day (BOEPD)
-- A successful appraisal well on the Adam Block
-- Production increases at Adam of more than 60% compared to average 2006 levels
-- Potential drilling of 9 additional Tunisia wells over the remainder of 2007
Pioneer has a substantial acreage position in the Ghadames Basin of southern Tunisia with an interest in 5 blocks totaling 3.9 million acres.
During the fourth quarter of 2006 and first quarter of 2007, the Tunisia drilling program gained significant momentum with four discoveries on two blocks adjacent to the Adam Concession, where Pioneer has enjoyed drilling success and increasing production since 2003. Three discoveries were drilled on the Pioneer-operated Jenein Nord Block (50% interest assuming ETAP participation) and one discovery was drilled on the Borj El Khadra Block (20% interest assuming ETAP participation).
Of the three Jenein Nord discoveries, two have been tested (Waha and Cherouq) at a combined rate of over 12,000 BOEPD from multiple zones. The combined tests, which are not necessarily indicative of ultimate production, resulted in production which was approximately 70% oil and 30% gas and condensate. The third discovery (El Badr) encountered approximately 35 meters of oil-bearing sands and is expected to be tested in mid-April.
Plans to construct oil production facilities on the Jenein Nord Block are well underway, with first oil production expected during the fourth quarter of 2007. A combined oil production rate forecast is expected to be available for the block by June after testing is completed on the El Badr discovery and production facility plans are finalized. Gas and condensate will not be sold from Jenein Nord until infrastructure is available to transport these products from the block to the northern part of Tunisia. Pioneer and other producers in the country are working with the government to evaluate the opportunity to expand infrastructure to supply gas production from southern Tunisia to northern markets.
On the Borj El Khadra Block, a late-2006 exploratory well (Nakhil) encountered an oil zone with excellent porosity and was tested at rates in excess of 1,000 barrels of oil per day. Since this discovery was made in a new reservoir, the well has been shut in for further evaluation and formulation of an appraisal program.
In the Adam Concession, Pioneer has participated in 12 wells since 2003 with greater than 90% success. The Company holds a 20% interest in the Concession in partnership with Eni (Operator), Talisman and ETAP. During March, the Nour-2 appraisal well was successfully completed and is expected to be brought on production during the second quarter. Total Adam production is expected to increase to approximately 25,000 BOEPD, or approximately 4,250 BOEPD net to Pioneer, at that time. This compares to 2006 average production of approximately 2,600 BOEPD net to Pioneer.
Pioneer and its partners have acquired approximately 1,200 square kilometers of 3-D seismic to optimize the drilling programs on the Adam, Jenein Nord and Borj El Khadra blocks. As a result, Pioneer has identified over 30 prospects and leads on these blocks, some with resource potential as large as 25 million barrels oil equivalent. Pioneer's drilling plans for the remainder of 2007 will be expanded to include up to five additional exploration wells on the Pioneer-operated Jenein Nord Block, three additional wells on the Adam Concession and possibly one well on Borj El Khadra.
"We have built a strong position in the Ghadames Basin of southern Tunisia and have had significant success to date. I'm excited that Tunisia is fast becoming a core area for Pioneer, offering strong production and reserve growth with low finding costs and attractive investment returns," stated Scott Sheffield, Pioneer's Chairman and CEO.
Pioneer is a large independent oil and gas exploration and production company, headquartered in Dallas, Texas, with operations in the United States, Canada, South Africa and Tunisia. For more information, visit Pioneer's website at www.pxd.com.
Except for historical information contained herein, the statements in this News Release are forward-looking statements that are made pursuant to the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements and the business prospects of Pioneer are subject to a number of risks and uncertainties that may cause Pioneer's actual results in future periods to differ materially from the forward-looking statements. These risks and uncertainties include, among other things, volatility of oil and gas prices, product supply and demand, the ability to obtain environmental and other permits and the timing thereof, other government regulation or action, third party approvals, international operations and associated international political and economic instability, the costs and results of drilling and operations, availability of drilling equipment, Pioneer's ability to implement its business plans or complete its development projects as scheduled, access to and cost of capital, the assumptions underlying production forecasts, uncertainties about estimates of reserves, quality of technical data, environmental and weather risks, acts of war or terrorism. These and other risks are described in Pioneer's 10-K and 10-Q Reports and other filings with the Securities and Exchange Commission.
Cautionary Note to U.S. Investors -- The SEC permits oil and gas companies, in their filings with the SEC, to disclose only proved reserves that a company has demonstrated by actual production or conclusive formation tests to be economically and legally producible under existing economic and operating conditions. Pioneer uses certain terms in this release, such as "resource potential" or other descriptions of volumes of reserves potentially recoverable through additional drilling or recovery techniques that the SEC's guidelines prohibit Pioneer from including in filings with the SEC. These estimates are by their nature more speculative than estimates of proved reserves and accordingly are subject to substantially greater risk of being recovered by Pioneer.
SOURCE: Pioneer Natural Resources Company
Pioneer Natural Resources Company
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