Galapagos well production ahead of schedule, Deep Blue prospect halted

All three of Noble Energy's wells in the Gulf of Mexico are now producing at rates higher than anticipated.

The three wells are located at the Galapagos development in the deepwater Gulf of Mexico. With the announcement of the positive production rates, Noble Energy also announced that appraisal of the Deep Blue prospect has been halted.

Production in the Galapagos area was initiated from the BP-operated Isabela field in June. That project was followed by the Noble Energy-operated fields of Santa Cruz and Santiago, which were flow tested with production increased over the course of several weeks. Noble's net production in the region is now 13,000 barrels of oil per day and 8 million cubic feet of natural gas per day. Those figures are roughly 30 percent higher than predicted.

"Galapagos is our second major project to start up in the past eight months and will provide significant production and cash-flow growth. We continue to build on our strong track record of execution as this project came online less than three years after sanction," said David L. Stover, Noble Energy's president and chief operating officer, in a press release. "Galapagos is one of the first development projects to start up in the Gulf of Mexico after the moratorium, and our permit to drill Santiago was the first such permit received following the moratorium."

Despite hydrocarbons being present in both the initial exploration well and subsequent sidetrack at Deep Blue, Noble decided not to proceed with additional appraisal activities at this time. The Deep Blue well was originally spud in 2009, and sidetrack operations were under way when the moratorium was announced. Noble Energy suspended operations and released rig working when the moratorium took effect. Once the band was lifted, another rig was certified to finish the sidetrack. Noble expects to record $118 million of exploration expense in the second quarter related to the Deep Blue prospect according to a press release.

Noble Energy is an independent energy company that works worldwide in oil and gas exploration and production. Visit www.nobleenergyinc.com for more information.