Projects

Block 22/12, Beibu Gulf, China

Horizon Net Working Interest (Production License) – 26.95%

Asset Overview

Block 22/12, Beibu Gulf, China, 26.95%
JV: CNOOC (51% – Block 22/12 Operator), Roc Oil (19.6%), Oil Australia Pty. Ltd. (2.45%)
Low cash operating costs of approximately $22/bbl produced for the year (excluding workover costs)
WZ6-12, WZ12-8W and WZ12-8E field abandonment costs prepaid into a sinking fund

Recent Highlights

During FY26, Horizon’s working-interest production was 622,240 barrels and sales were 523,843 barrels, generating US$41.6 million of production revenue
Cash operating costs were approximately US$25/bbl produced, excluding workover costs. Targeted well optimisation, additional water-handling capacity and workovers supported production, and all FY26 workover programs were safely completed
The Joint Venture continues to progress production-enhancement initiatives and feasibility studies for a potential further WZ12-8E development phase, subject to customary approvals

Background

Block 22/12 oil development comprises nine hydrocarbon pools across three different Production Licenses. It lies 35km southwest of Weizhou Island, China, in 30m water depth.

The initial development included production from the WZ6-12 (ten production wells) and WZ12-8W (five production wells) fields through two unmanned wellhead platforms, via a three-phase flow via insulated pipeline to the new processing, utility and quarters “B” platform (PUQB) adjacent to CNOOC’s WZ12-1 production and pipeline hub. Oil, gas and water is separated on the PUQB and the oil exported to shore via CNOOC production and pipeline facilities.

The oil is stored at facilities on Weizhou Island prior to transport to market and the gas utilised, as required, by the Weizhou terminal facilities. Waste-water is reinjected into existing water injection wells, ensuring zero waste water discharge to environment during normal operations.

WZ6-12 & 12-8 project FID was taken in 2011 on the basis of 16.2 million barrels of estimated gross 2P reserves (Horizon net 4.4 million barrels) and an expected 10-year field life, and production began in March 2013 from two wells in the 6-12 field. Phase 1 development drilling was completed on August 2013. Reserves increased by 18% with three successful appraisal wells drilled during the same period.

Between 2014 and 2022, reserves and resources were substantially added to through a number of well interventions, and the following drilling activities:

Two exploration wells in 2014 (WZ12-10-1 & WZ12-10-2)
One development well in 2015 (WZ12-8W A6H)
Two development wells in 2018 (WZ12-8W A7H and A8H)
One appraisal well in 2019 (WZ6-12M1)
Two development wells in 2020/21 (WZ6-12 A11 and A3S2)
Two development wells in 2022 (WZ6-12-A12S1 and A10S1)

New WZ12-8E development project first oil in 2022: The WZ12-8E project consists of 11 horizontal producers drilled into three separate fields plus a water disposal well. First oil was achieved in April 2022 only 17 months after FID. The first and second phases of development were completed in January 2023 with WA12-8E project production reaching a peak of 12,600 bopd gross (Horizon net 3,400 bopd) in August 2022. The joint venture is actively investigating further development of the WZ12-8E fields.