McMoRan Exploration Co. announced today that on Dec. 30, 2004, it established production from the Deep Tern C-2 well at Eugene Island block 193 at an initial rate of 17 MMcf/d) on a 20/64 in. choke with flowing tubing pressure of 12,650 psi. The company drilled the Deep Tern C-2 well to a total measured depth of 20,731 ft in November 2004 and logged approximately 340 gross ft of hydrocarbons in five Basal Pliocene and Upper Miocene pay zones.
Initial production was established through 80 ft of perforations in the deepest Miocene interval. Since the Eugene Island block 193 lease is eligible for royalty relief on the first 10 bcf of natural gas production, McMoRan's net revenue interest will approximate 45% until 10 bcf is produced. After 10 bcf of production, McMoRan's net revenue interest will be 37% in the deeper Basal Pliocene and Upper Miocene sections of the well.
Operations began to sidetrack McMoRan's C-1 well to drill a take point for the Basal Pliocene gas reserves proven by 86 gross ft of hydrocarbon-bearing sands logged in the C-2 well. McMoRan holds a 20.6% net revenue interest in the C-1 sidetrack. McMoRan plans to drill an offset well (D-l offset) to delineate and develop the multiple gas sands encountered in the C-2 discovery.
"The Deep Tern discovery was brought on production less than two months after reaching total depth in the well. This project is an excellent example of how existing infrastructure adds significant value to discoveries in our deep shelf exploration activities. We are enthusiastic about the opportunities available from our active deep shelf program as well as our progress in establishing an LNG terminal at our Main Pass Energy Hub project," said James R. Moffett and Richard C. Adkerson, co-chairmen of McMoRan.
McMoRan's 2004 discoveries were Deep Tern, Minuteman at Eugene Island block 213, Dawson Deep at Garden Banks block 625 and Hurricane Upthrown at S Matagorda Island block 217. T The Minuteman discovery is expected to be producing in 1Q 2005 using McMoRan's facilities at Eugene Island block 215.
1/6/05
