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FYI
---------------------- Forwarded by Bob Lee/NA/Enron on 10/16/2000 11:46 AM --------------------------- Gregory P Smith@ECT 10/16/2000 10:06 AM To: Bob Lee/NA/Enron@ENRON cc: Subject: Re: Seismic Data via satellite Bob, Here are a few comments on this note: 1. Deal with seismic company was done by a Mark Peterson who is still with Enron. I haven't caught up with him for details but it had to do with underwriting (risk of no sales) seismic survey. Timing is important. Interest may have picked up in new surveys and the survey company decided that they didn't need Enron anymore because they no longer saw a risk of no sales. 2. 3-D surveys will happen where there is an abundance of E & P activity or be spurred on by successes in a given basin. While activity continues in the Gulf of Mexico on the shelf, the major discoveries are being found in the deep water. Worldwide, the shallow water plays have been looked at and worked for years - they were accessible with the extraction technology of the time. I don't think that deep water sedimentation /depositional systems were completely understood to even begin to try to justify looking in deep water. Concepts have evolved quite quickly. The point is that many deep water accumulations are incredibly large - billion barrel accumulations. These sizes are like those accumulations that were found decades ago when companies were drilling surface structures. The large reserves are needed to pay for the corresponding incredibly expensive costs of deepwater field development. I believe that finding and development costs ($/barrel) are at least two to three times shelf f & d costs in the Gulf of Mexico. This differential is probably large with international projects (and that doesn't take into account political risk). I'll look forward to more involvement if and when this project /concept goes forward. Feel free to forward this to all participants. Greg Bob Lee@ENRON 13/10/2000 08.30 To: Gregory P Smith/HOU/ECT@ECT, Richard Reichardt/Enron Communications@Enron Communications cc: Vince J Kaminski/HOU/ECT@ECT Subject: Seismic Data via satellite I am preparing a summary or our Thursday discussions to be used as a background piece for discussion/brainstorming with oil traders. I will circulate this for review/correction later today, or ,at the latest, Monday. Greg, you mentioned that Enron had participated in a speculative survey in the Gulf of Mexico that was successful. It might be useful to get more info on this. Terms, return realized (over what time frame), why we have not continued to do this, etc. Also, from your comments, many, if not most of the 3-D surveys are in deep water. I read recently that Shell, I believe, is participating in a deep sea drilling/extraction project in the Gulf. What oil price is required to make these kinds of projects viable financially? Bob Lee
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