BP Exploration Angola − an affiliate of the British energy
) − has commenced production at its ultra-deep water PSVM project
in block 31, off the Angolan coast.
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Discovered between 2002 and 2004, the PSVM development comprises
four oil fields in Angola - Plutão, Saturno, Vénus and Marte. In
the first phase of the PSVM development, production from three
wells in the Plutão field is expected to increase to around
70,000 barrels of oil per day (BPD). This will likely reach a
maximum level of 150,000 BPD in the coming years upon the
successful start-up of production from the remaining fields -
Saturno and Vénus in 2013 and Marte in 2014.
PSVN is considered the largest subsea development project
worldwide and is the second BP-operated venture in Angola after
Block 18's Greater Plutonio. BP expects this development to make
a major contribution to Angola's production thereby generating
sizeable returns to the country.
Since the commencement of PSVM's production, BP generated around
3.5 million barrels of oil and hence development of a hub in the
southeast sector of block 31 is already underway.
In the northeastern part of block 31, PSVN lies in a water depth
of up to 6,562 feet. BP operates the project with a 26.67%
interest and the associate partners Sonangol E.P., Sonangol
) affiliate Statoil Angola A.S., Marathon International Petroleum
Angola Block 31 Limited − a subsidiary of
Marathon Oil Corporation
) − and SSI 31 Ltd hold 25%, 20%, 13.33%, 10% and 5%,
respectively. Sonangol E.P. acts as the concessionaire.
This latest start-up is in sync with BP's agenda to focus on four
high-margin areas - Angola, Azerbaijan, the Gulf of Mexico and
the North Sea, with an aim to grow output in these areas over the
next five years. The enhanced exploration spending will expand
its current core areas and the company targets around 35 wells
with resource potential in excess of 250 million barrels of oil
BP's third quarter 2012 production shrunk 2.7% year over year,
mainly due to field declines and divestments. However; major
project start-ups, enhanced operation in Angola and higher output
in other areas partly offset the decline. The company expects
margin expansion from new projects to drive its future production
BP, UK's second largest oil company by market value after
Royal Dutch Shell plc
), is supported by a Zacks Rank #3, which is equivalent to a Hold
rating for a period of one to three months. BP will report its
fourth quarter as well as full-year 2012 earnings on Feb 5,
before the opening bell.