Western Europe: Denmark

WESTERN EUROPE

North Sea portions written by Arthur Andersen-Petroleum Services Group, London

Denmark

Licensing. In the second half of 2000, DONG was awarded an extension of license 16/98, held under terms of the Fifth Round awards. The new license area includes existing blocks and part-blocks, as well as newly awarded part-blocks 5604/19a and 5604/20e.

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In the last quarter, there were two license applications under the open-door procedure, which runs every year between January 2 and September 30. Sterling Resources and Dansk Efterforskningsselskab Aps made an application for a license covering six blocks in the onshore Northern Jutland area. Also, Minijos Nafta, Sterling and Dansk Venture Olieefterforskning Aps applied for a license in Southern Jutland and surrounding areas; these licenses were awarded in first-half 2001.

Drilling. The pace of Danish drilling activity has increased significantly over the past year, with a total 18 exploration / appraisal wells spudded in second-half 2000 and first-half 2001; half of the spuds were exploration wells. DONG was the most active operator, spudding eight wells, Maersk started seven.

Exploration. DONG made three new discoveries during the past year. In August 2000, the Nini accumulation was discovered in Block 5605/10. Nini-1 was sidetracked and tested oil from a Paleocene sandstone at a rate of 5,856 bpd. Toward the end of the year, the company found oil in the Cecilie structure in 5604/20. The discovery tested 1,888 bopd from Paleocene sandstones. The company then went on to drill the Connie-1 well in February 2001, located just a few kilometers from the Cecilie discovery, in 5604/19. Oil was encountered in the Paleocene but was not tested.

Development / production. 2001 saw production of oil and / or gas from a total of 16 Danish fields. Total oil production in 2000 amounted to 132 MMbbl, averaging 363,000 bpd. Production in 2001 is expected to drop to around 324,500 bpd. Overall gas production in 2000 was reported at 685 MMcfd, up from 653 MMcfd in 1999.

Halfdan field, with 70 MMbbl oil and 54 Bcf gas, had a new wellhead platform installed in September 2000. Three new wells (two producers and one water injector) were also drilled. Production in Halfdan averaged 19,000 bopd and 18 MMcfd gas in 2000. Stine, a satellite field east of Siri field, is currently seeking development approval and is expected to start production in second-half 2002. The field contains about 7 MMbbl. PDOs are expected to be submitted for a number of new fields in the following year. It is expected that approval will be sought for the Maersk Lola field, which contains 7.5 MMbbl oil and 3.6 Bcf gas.