Dana Petroleum will acquire a 25.8 per cent interest in the Caledonia oilfield through a North Sea asset swap deal with Conoco. Conoco’s North Sea interests have proven and probable reserves of 9.4 million barrels.
In exchange for the assets, Conoco will receive Dana's 3 per cent interest in the Orca and Beta gas discoveries. It will also receive an initial cash payment of $2.5 million and a deferred sum of $5 million payable over the next three years once production milestones are reached in the Caledonia field.
Dana chief executive Mr Tom Cross said the deal is in line with Dana's strategy of turning its exploration discoveries into significant production opportunities.
The Caledonia oil field recently received development approval and is scheduled to achieve first oil production in 2002 with daily output rates put at 12,000 barrels initially. The field's proven and probable reserves are estimated at 10.3 million barrels, giving 2.6 million barrels net to Dana's interest.
Total development costs are expected to be around £31 million, of which £8 million would fall to Dana.
AFP