There's no telling what far-flung locale might tug at a company's heart - and purse - strings. For three companies, key points of interest are along the Pacific Rim.

Unstable political regimes, warring factions and sheer distance might keep many countries from venturing near Southeast Asia and Australasia. But those that do often find highly favorable geology and countries ripe for economic investment.
Philippines
The huge gas field that will be powering the Malampaya Deep Water Gas to Power Project was originally discovered in 1989 when Occidental Philippines Inc. (Oxy) discovered gas in the Camago-1 well in the area covered by Service Contract No. 38 (SC38), offshore Palawan. The area was known to be gas-prone, but it was in deep water and 300 miles (500 km) from its potential market.
In 1990, Shell Philippines Exploration BV (SPEX) farmed in, taking a 50% interest and operatorship of Block SC38 and providing the necessary deepwater technology, financial strength and stamina to develop the resource. As part of the farm-in deal, Shell drilled three wells, the second discovering the large Malampaya gas field, with its 130-ft to 2,000-ft (400-m to 600-m) gas column and 213-ft (65-m) oil rim, connected to the Camago structure. The promising discovery was further appraised by three additional wells, and by 1995 Shell was convinced that Malampaya, with proven recoverable volumes of 2.5 Tcf of gas and 85 million bbl of condensate, represented a significant opportunity for a commercial gas development in the Philippines.
The region is hardly ideal from a geological perspective. "The area is vastly underexplored and is not considered to be highly prospective on a global scale," said David Greer, SPEX general manager. "However, given the existence of Malampaya, it is hard to believe that there isn't another one there in this vast ocean area around the Philippines."
Greer added the development is far from straightforward. "Whilst the gas reserves are significant, the Malampaya structure lies in 2,500-ft to 3,800-ft (750-m to 1150-m) water depth, making its exploitation a recognized challenge for the exploration and production industry," he said. But the company's experience in this arena enabled it to pursue the commercial development of Malampaya.
Initially, three development concepts were evaluated. For the combined development of oil and gas, a tension-leg platform (TLP) and a floating production, storage and offloading (FPSO) facility were considered. During the appraisal campaign, it became evident the oil development was marginal from an economic perspective given the thickness of the oil rim. The FPSO option was rejected on the grounds of the technical complexity associated with the number of gas risers and the high pressures. A TLP option also was rejected in favor of a less expensive alternative for the gas-only development. The chosen solution comprises a deepwater subsea tieback to a shallowwater platform with topsides installed using a "float-over" technique, giving the most competitive landing price for the gas. This method allows a complete integrated deck to be installed as one unit, thereby maximizing the fabrication and testing work that can be completed onshore.
At an installation weight of 11,500 tons, the Malampaya topside is the largest integrated deck ever installed in the Asia-Pacific region and the largest offshore installation in the world using the float-over method. Its supporting base, the Malampaya concrete gravity structure, was installed 3 months ahead of schedule June 2, 2000.
The topsides facilities were fabricated in Singapore and towed to the Philippines March 1, 2001.
The Malampaya project marks the dawn of the gas industry in the Philippines, Greer said, illustrating the crucial importance of integrating the development of gas markets with the construction of the necessary infrastructure. The Malampaya development comprises five subsea wells in 2,700 ft (820 m) of water, producing via a subsea manifold and two 19-mile (30-km), 16-in. flow lines to a platform in 141 ft (43 m) of water. These wet gas flow lines, with their large vertical displacements and the mixture of gas and liquids, push subsea gas development technology to higher levels, Greer said.
The gas and condensate will be treated on the platform to export specification. Gas will be compressed and transported via a recently constructed 313-mile (504-km), 24-in. pipeline to an onshore gas plant at the site of the Shell refinery at Tabangao (Batangas, Luzon Island). The condensate will be stored in the platform substructure base and exported about every 2 weeks via shuttle tankers.
New Zealand
New Zealand discovered petroleum in the 1860s, but until recently it had only drilled about 200 wells. In spite of this underexploitation, it has averaged about one big discovery every decade during the past 40 years. Swift Energy and others plan to tweak that frequency even further.
New Zealand has a stable political regime and favorable fiscal terms. The relatively few existing wells have led to the discovery of substantial petroleum and gas fields, and for a developing hydrocarbon basin, it has an unusually large amount of infrastructure already in place to transport product to markets. On the other hand, the New Zealand gas market is not as robust as the gas market in the United States. The New Zealand market is relatively balanced, suggesting that huge new discoveries can't be monetized quickly.
So Swift decided to test its fortunes in the country's established petroleum province, the Taranaki Basin, believing it was still hugely underexplored.
Swift went to New Zealand with an idea. Instead of exploring in the "safe" areas west of the Taranaki Thrust Belt system, what would happen if one drilled a little closer to the thrust belt? Established wisdom for the area said thrust belts wouldn't contain any hydrocarbons, so drilling into them would be a waste of money. Swift decided to challenge this theory.
Its Rimu discovery well was drilled in December 1999. It proved several things. One is that the thrust belt system is actually a ledge of basement rock that was thrust up, and the tectonic movement caused repeat sections of the same strata. There is sand development, and the ledge provides a seal for hydrocarbons. Swift has drilled five wells at Rimu and discovered multiple hydrocarbon zones in all five, which suggests sourcing of hydrocarbons.
Rimu also led the company to a larger structure, which was drilled from an onshore location at Kauri. Swift acquired additional offshore acreage, which it believes secures the location, after Fletcher Challenge released the permit back to the government. The first Kauri well encountered four different horizons, including two new sands - the shallow Manutahi sand and the Kauri sand, which has more than 800 ft (244 m) of gross section. The Kauri well also demonstrated that the upper plate, consisting of the same Tariki sand and Rimu limestone, stretched more than 5 miles (8 km) to Rimu in the north.
"The thing all of this drilling has proved up to us is that somewhere down there you have a very large kitchen that's cooking hydrocarbons," said Bruce Vincent, executive vice president of corporate development and secretary at Swift. "There's a tremendous amount of sourcing because we're seeing hydrocarbons throughout these wellbores."
The company is conducting extended production testing at Rimu, flaring the gas and producing the oil from the A-1 well. While considered an oil discovery, Rimu has large amounts of associated gas with a high liquid content, so Swift is building production facilities to separate the liquid and gas streams. This plant is expected to be at full capacity by end of the first quarter of 2002 and is designed for easy expansion once a better production profile is developed. Meanwhile drilling continues at Rimu and Kauri to develop and better define the fields.
For an independent that has only recently begun to foray into the international arena, New Zealand has been a bonanza. "We've got incredible potential in terms of exploitation and development at Rimu, and we've got a discovery at Kauri with a tremendous amount of work to do," Swift's Vincent said. "We have identified prospects for next year at Tawa and Matai on our current exploration permit. Plus, we have three other permits along the thrust belt, where we will be shooting seismic and evaluating their potential.
"New Zealand is now as much of a core area to Swift Energy as our core areas in South Texas or the Texas/Louisiana Gulf Coast."
Vietnam
Conoco is the largest acreage holder in Vietnam among foreign explorers, and it shows no signs of slowing down. Within the past few months the company has completed two wells, the Sutu Den-2X in Block 15-1 and development well 15P in Block 15-2, which cumulatively flowed more than 20,000 b/d.
Conoco also has interests in three other offshore Vietnam blocks, including Block 16-2, with plans to drill the first exploration well late this year and an adjacent well during the first half of 2002, and blocks 133 and 134, where seismic studies are under way to evaluate hydrocarbon potential and determine drilling plans.
Since 1996 Conoco has invested more than US $200 million in Vietnam, and it plans to invest an additional $500 million during the next several years as part of an aggressive development plan for the region.
Conoco had studied Vietnam's potential since the early 1990s, but the US-based major was restricted in its activities because of its country's trade embargo against Vietnam. When that embargo was lifted, the company moved quickly to ramp up its presence, and it signed its first petroleum contract in April 1996.
"Vietnam presented a strong fit for Conoco's regional strategy and was considered a good 'niche play' for us," said Joe Hwang, country manager for Conoco Vietnam. "We understood the geology well and had the right technologies and capabilities for a successful development program. This gives us a competitive edge."
Working in Vietnam requires a bit of staying power. Hwang said other companies have left due to a combination of difficult fiscal terms, lack of drilling success and exceptionally high operating costs. "At first, we had difficulty assembling the critical mass needed for a sustainable business in Vietnam," he said. "But once the government saw our vision, commitment and quick action, especially during the Asian economic crisis, it allowed us to expand."
The company's investment goes beyond financial, he said. Conoco works with government officials to attract more international investment to help the country build sustainable businesses that can withstand the cyclic nature of a global economy. "We're also working with the local government to develop the country's natural gas resources, starting with the associated gas in the offshore area of the Mekong Delta," he said.
Company officials state that a growing Vietnam presence plays a key role in Conoco's aggressive growth plans. It recently designated Southeast Asia as its fourth core area following its acquisition of Gulf Canada Resources Ltd. and that company's majority interest in Gulf Indonesia Resources Ltd. This acquisition significantly increased Conoco's upstream presence in the region, which already included interests in Malaysia, Indonesia and Cambodia.
Future plans include building on the commercial success in the Cuu Long Basin and other long-term growth opportunities. "Beyond our large portfolio of high-quality exploration and production acreage, I think our Vietnam business will be one of Conoco's great success stories, especially in regard to sustainable development," Hwang said.

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