Integrated oil and gas company TOTAL S.A. (TOT) announced that its Pazflor field offshore Angola has started to produce ahead of expectations. The company will gradually increase the production from this field to 220 thousands barrels per day over the coming months. The new production will spur TOTAL’s liquid production level from 1,197 thousand barrels per day produced during the second quarter.
The Pazflor field is located 93 miles (150 km) off the coast of Angola and 25 miles (40 km) north-east of Dalia. The expected proved and probable reserves in this field are 590 million barrels, lying at a water depth of 600 meters to 1,200 meters.
The Pazflor field, in Block 17, is jointly operated by TOTAL’s unit Total E&P Angola (40% interest) along with Statoil ASA (23.3%), Esso Exploration Angola (Block 17) Limited (20%) and BP Exploration (Angola) Ltd (16.67%).
This oil field has two grades of oil in four separate reservoirs. Three Miocene reservoirs, at water depths of 600 meters to 900 meters and accounting for two-thirds of the reserves, consist of the heavy variety of oil. The Oligocene reservoir, located at water depths of 1,000 meters to 1,200 metres, contains lighter oil.
To collect the oil from the water depth, the company along with its partners has created a complex subsea gathering network. The network consists of 111.8 miles (180 km) of lines connecting 49 subsea wells, 10,000 metric tons of subsea equipment and the giant Pazflor floating production, storage and offloading (FPSO) vessel. The FPSO vessel has a capacity to store 1.9 million barrels of oil which subsequently is exported via tankers.
TOTAL's African exposure accounts for the highest share in total production. Total hydrocarbon production of the company during the second quarter 2011 averaged 2,311 thousand barrels of oil equivalent (kboe) per day, out of which the African generation comprised as much as 27.2% or 628 kboe per day.
We nevertheless note that despite being the largest contributor, TOTAL’s production from Africa during the second quarter 2011 declined 16% from the year-ago level, which was mainly attributable to the disruption of production in Libya. We expect the addition of the Pazflor field production to make up for lost volumes in the months ahead and boost production.
TOTAL S.A. currently retains a Zacks #3 Rank, which translates into a short-term Hold rating. The company competes directly with BP Plc (BP).
France-based TOTAL is one of the largest publicly traded, globally integrated oil and gas companies based on production volumes, proved reserves and market capitalization. The company has exploration and production operations across five continents.
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