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July 2007

Vol. 12, No. 30 Week of July 29, 2007

Gas flowing from Independence hub

Numerous deepwater records set in eastern Gulf of Mexico

Ray Tyson

For Petroleum News

First production has begun flowing from Independence Hub, located in the ultra-deep waters of the Eastern Gulf of Mexico, following several years of explorers accumulating enough natural gas discoveries to justify investment in a major standalone offshore development involving multiple partners.

Located in about 8,000 feet of water on Mississippi Canyon block 920, roughly 123 miles southeast of Biloxi, Miss., Independence Hub is the deepest production platform ever installed and also the world’s largest offshore natural gas processing facility.

“Together we achieved first production on time and within budget from a world-record-setting facility in an ultra-deep area of the Gulf where previously there was no infrastructure,” noted Jim Hackett, chief executive officer of Anadarko Petroleum, which operates the Independence Hub Platform on behalf of the Atwater Valley Producers Group.

Other members of the producers group are Devon Energy, Italy’s Eni and Norway’s Hydro, along with the actual owners of the Independence Hub facility, Enterprise Products Partners and Helix Energy Solutions Group.

Natural gas production began July 19

Natural gas production through the Hub began on July 19 from the first of 15 subsea wells in 10 anchor fields: Atlas, Atlas NW, Jubilee, Merganser, San Jacinto, Spiderman, Vortex, Mondo NW, Q and Cheyenne. The producers expect to ramp up production toward the Hub’s capacity of 1 billion cubic feet of natural gas per day by late 2007.

First sales were received from the Atlas No. 1 well on Lloyd Ridge block 50. The well was expected to ramp up to a rate of about 50 million cubic feet per day during the first week of production. The block was awarded as a result of Lease Sale 181 in 2001, which opened a new area of the Eastern Gulf of Mexico to exploration. Most of the additional 14 wells have been completed and flow tested; the majority had rates above 50 million cubic feet per day and will be brought on stream one at a time during 2007, Anadarko said.

Independence Hub is a 105-foot, deep-draft, semisubmersible platform with a two-level production deck. The natural gas processed through the hub when operating at full capacity represents an increase of more than 10 percent in supplies from the Gulf of Mexico. Anadarko has reserved approximately 61 percent of the capacity on the Hub, Eni about 20 percent, Hydro 12.5 percent and Devon 6.5 percent.

134-mile pipeline connects hub to markets

The Independence Trail pipeline, 100 percent owned and operated by Enterprise, connects the hub platform to onshore markets via connection with the Tennessee Gas Pipeline at Enterprise’s West Delta block 68 shallow-water manifold platform. The pipeline is about 134 miles long, 24 inches in diameter and has the capacity to transport up to 1 billion cubic feet of gas per day.

The Independence project, in addition to being the deepest platform at 8,000 feet, set other world records during its construction and installation, which include: the deepest subsea production tree in 9,000 feet of water at the Cheyenne field; the deepest steel catenary riser installation; and the world’s deepest export pipeline and steel catenary riser, originating in approximately 8,000 feet of water.

“We’re confident that Independence will serve as the blueprint for future deepwater development,” said Ralph S. Cunningham, Enterprise’s president and chief executive officer.

Atlas field discovered in 2003

Project details include:

• Anadarko discovered the Atlas field in June 2003 in 9,000 feet of water. A satellite discovery, Atlas NW, followed in January 2004. Anadarko holds a 100 percent interest in the fields.

• Anadarko discovered the Jubilee field in April 2003 in 8,800 feet of water. Anadarko holds a 100 percent interest in the field.

• Merganser was discovered in December 2001 by a subsidiary of Anadarko. It is located in a water depth of 7,900 feet. Anadarko operates the field with a 50 percent working interest. Devon Energy holds the remaining 50 percent working interest.

• Natural gas was discovered at the San Jacinto field in April 2004 in 7,850 feet of water. Eni operates the field with a 53.3 percent working interest. Hydro holds a 26.7 percent working interest and Anadarko has a 20 percent working interest.

• Anadarko discovered the Spiderman field in November 2003 in a water depth of 8,087 feet. Anadarko is the operator and holds a 45 percent working interest. Eni holds a 36.7 percent interest and Hydro holds an 18.3 percent interest.

• The Vortex field was discovered in December 2002 and is located in a water depth of 8,344 feet. Anadarko holds a 100 percent interest in the field.

• Anadarko discovered the Mondo NW field in December 2004 in about 8,300 feet of water. Anadarko operates Mondo NW with a 50 percent working interest. Murphy Exploration & Production Co. holds the remaining 50 percent working interest.

• The Q field was discovered in June 2005 in 7,925 feet of water. Q is operated by Hydro with a 50 percent working interest. Eni holds the remaining 50 percent working interest.

• Anadarko discovered the Cheyenne field in January 2005. It has the world’s deepest sub-sea production tree in about 9,000 feet of water. Anadarko holds a 100 percent interest in the field.






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