Newfield repairs pipeline, resumes oil production at East Belumut field offshore Malaysia

By Phaedra Friend Troy

Newfield Exploration Company (NYSE:NFX) has resumed oil production at its East Belumut field offshore Malaysia following pipeline repairs.

Production from the East Belumut oil field was shut-in for four weeks following damage to the subsea pipeline connecting the East Belumut platform on PM 323 to the Tinggi platform 17 miles away. The pipeline was ruptured by an unidentified, unrelated vessel.

Repairs to the subsea pipeline were expected to take up to eight weeks to complete.

"Our Malaysian team did a fantastic job of identifying the damaged line, minimizing the impact on the environment and quickly returning the line to service," said Lee K. Boothby, Newfield Chairman, President and CEO. "In the second half of 2010, we will continue to focus our investments toward the oil assets in our portfolio, live within cash flow from operations and maintain our original capital budget of $1.6 billion."

Gross production at East Belumut has quickly ramped back up to more than 20,000 barrels of oil a day.

The amount of Newfield production that was deferred due to the shut-in at East Belumut is estimated to be 300,000 barrels of oil, substantially less than the originally estimated 500,000 to 600,000 barrels of oil.

Newfield's 2010 production is expected to reach 283 to 288 billion cubic feet of oil equivalent, which is an increase of 10 percent over its 2009 production.

East Belumut is located on PM 323 about 160 miles offshore Penninsular Malaysia in 240 feet of water. Newfield operates the oil field with 60 percent interest.

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