Lundin Petroleum
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Address
Lundin Petroleum
Hovslagargatan 5
SE - 111 48 Stockholm
Sweden
Tel 46 8 440 5450
Fax 46 8 440 5459
Web http://www.lundin-petroleum.com
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Capex
Lundin Petroleum AB has set a USD 725 million exploration and development capital expenditure budget for 2008. The budgets will be funded from operating cash flow and existing bank facilities.
In 2007, Lundin set a USD 520 million exploration and development capital expenditure budget.
Future Plans
In 2008 Lundin Petroleum will continue its major investment programme in exploration activities with a budget of USD 350 million. The work programme will involve drilling 13 exploration wells and three appraisal wells. The exploration wells (excluding Vietnam and Congo) will target 1.2 billion barrels of net unrisked oil equivalent reserve potential and 360 million barrels of net risked oil equivalent reserve potential. This compares to Lundin Petroleum's current certified proven and probable reserves of 184.2 million barrels of oil equivalent (MMboe). The major areas of focus for exploration drilling will be Norway, Russia, Sudan, United Kingdom, Vietnam and Congo.
Norway. Three exploration wells and at least three appraisal wells will be drilled of which four will be operated by Lundin Petroleum. The exploration wells will be drilled in PL 304 (working interest ("WI") 50%), PL 292 (WI 40%), PL340 (WI 15%) and the appraisal wells on the Luno discovery in PL 338 (W I 50%), on the Nemo discovery in PL 148 (WI 50%) and the South East Tor discovery in PL 006c (WI 75%).
Russia: Two exploration wells will be drilled on the Lagansky Block (WI 70%) offshore Russia in the Caspian Sea.
Sudan: At least four exploration wells will be drilled in Block 5B (WI 24.5%) in the Muglad Basin.
United Kingdom: One exploration well will be drilled on P1107 close to the Scolty discovery (WI 40%).
Vietnam: One exploration well will be drilled on Block 06/94 (WI 33.3%), offshore Vietnam.
Congo: One exploration well will be drilled on Block Marine XI (WI 18.75%), offshore Congo.
Drilling rigs have been secured for all planned 2008 exploration and appraisal activities with the exception of Congo.
The development budget for 2008 is USD 375 million with a major focus on projects in Norway, United Kingdom and Indonesia.
Norway: The development of the Alvheim project (WI 15%) is ongoing with first produc tion at the end of March 2008. Plateau production is forecast at a rate of 90,000 boepd (14,500 boepd net to Lundin Petroleum). The development of the Volund field (WI 35%) is ongoing with first oil in 2009 at a forecast plateau rate of 23,000 boepd (8,000 boepd net to Lundin Petroleum).
United Kingdom: The redevelopment of the Thistle field (WI 99%) is ongoing with the reactivation of the Thistle platform drilling rig to be completed in 2008. Development drilling is ongoing on the Broom field (WI 55%).
Indonesia: The development of the Singa field (WI 25.88%) is ongoing with first gas in 2009, at a forecast rate of 48 mmscfd (2,000 boepd net to Lundin Petroleum).Production
Production for the financial year ended 31 December 2007 amounted to 12,662.9 (10,832.9) thousand barrels of oil equivalent (mboe) representing 34.7 mboe per day (mboepd) (29.7 mboepd) for the financial year ended 31 December 2007. The average price achieved for a barrel of oil equivalent for the financial year ended 31 December 2007 amounted to USD 65.65 (USD 59.70). The average Dated Brent price for the financial year ended 31 December 2007 amounted to USD 72.39 (USD 65.13) per barrel.
Net sales of oil and gas for the year ended 31 December 2006 amounted to MSEK 4,233.3 (MSEK 3,995.5) and MSEK 1,105.4 (MSEK 968.4) for the fourth quarter of 2006. Production for the year ended 31 December 2006 amounted to 10,832.9 (12,083.5) thousand barrels of oil equivalent (mboe) and 3,175.5 mboe (2,840.1 mboe) for the fourth quarter of 2006 representing 29.7 mboe per day (mboepd) (33.2 mboepd) for the year ended 31 December 2006 and 34.5 mboepd (30.9 mboepd) for the fourth quarter of 2006.
Reserves
As at 1 January 2007 Lundin's net proven and probable reserves increased to 176.4 million barrels of oil equivalent (MMBOE). This equates to a 29 percent increase to reserves since 1 January 2006 taking into account actual 2006 production.
The reserves are based upon a third party independent audit conducted by Gaffney Cline with the exception of the Russian reserves. The Russian reserves acquired during 2006 are substantially based upon earlier completed third party reserve reports completed by Ryder Scott and DeGolyer & MacNaughton as adjusted for actual production up to 1.1.2007.
Proven and Probable Reserves (MMBOE)
Gaffney Cline Reserves at 1.1.2006: 146.1
2006 Production (excluding Russia): -9.8
Venezuela (converted to a mixed enterprise companyand removed from reserves): -4.4
Reserve Additions (excluding acquisitions): +12.0
Acquisitions: +32.5
Proven and Probable Reserves at 1.1.2007: 176.4
Reserve increase: 29%
Reserve replacement ratio*: 122%
*As per industry standards the reserve replacement ratio is defined as the ratio of reserve additions to production during the year, excluding acquisitions and the conversi on to a mixed enterprise company in Venezuela.
The reserves do not include the recent acquisition of an interest in the Peik gas/ condensate field in the United Kingdom (33.3%)/Norway (50%) which awaits completion.
The proven and probable reserves have been calculated using the Society of Petroleum Engineers (SPE) and World Petroleum Congress joint definitions.
Who's Who
Alexandre Schneiter
Executive Vice-President and Chief Operating Officer
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Chris Bruijnzeels
Vice President Reservoir
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Tim Coulter
Vice President Operations
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Ashley Heppenstall
President and Chief Executive Officer
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Ian H. Lundin
Chairman of the Board
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Lukas H. Lundin
Director
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Lukas H. Lundin
Director
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William A. Rand
Director
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Magnus Unger
Director
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Alexandre Schneiter
Executive Vice President and Chief Operating Officer
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Geoffrey Turbott
Vice President Finance and Chief Financial Officer
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Christine Batruch
Vice President Corporate Responsibility
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Jeffrey Fountain
Vice President Legal
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Chris Bruijnzeels
Vice President Reservoir
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Tim Coulter
Vice President Operations
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Offices
Sweden
Head Office
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