Vanco awards drilling contract for Deepwater Ukraine
  by: OilOnline
  Tuesday, June 27, 2006

The first deepwater drilling contract for offshore Ukraine has been awarded by Vanco International Ltd. to Atwood Oceanics Pacific Limited, a wholly-owned subsidiary of Atwood Oceanics, Inc. for use of the Atwood Southern Cross semi-submersible drilling unit. The contract is for one firm well and one optional well in the Prykerchenska block of the Black Sea.

"Atwood is an established drilling contractor with a proven level of performance," says Vanco Chairman Gene Van Dyke. "Not only is the Atwood Southern Cross well-suited for the initial well location, but its current commitments in the Black Sea make it conveniently positioned for this drilling program," he says. In a window as early as August 2007 or as late as January 2008, the Atwood Southern Cross will drill off the shelf in the northeastern corner of the Prykerchenska block in water depths greater than 300 meters.

Just two months ago on April 19th, Vanco won a competitive tender for the right to conclude a Production Sharing Agreement with the Government of Ukraine for the highly prospective Prykerchenska Tender Area. JNR Eastern Investments Limited, a company representing certain investment interests of the Hon. Nathaniel Rothschild, is an equal partner in Vanco's application.

Covering 3.2 million acres, the Prykerchenska PSA Tender Area is located offshore the Crimea near the Kerch region. In its northern shallower part, the Tender Area contains a prominent Tertiary folded belt with numerous prospective structures that are on trend with the recently announced Subbotina oil and gas discovery. The deeper (below 2,000 meters) southern part of the block contains large structural closures, including the Tetyaev High.

The Ukrainian government expects that this Kerch region project could generate up to $2 billion in foreign direct investment into oil and gas exploration and extraction.

"Our contract for the Atwood Southern Cross demonstrates that we are working aggressively toward our goals for new production in the Ukraine," says Van Dyke.