Singapore (Platts)--27Nov2012/428 am EST/928 GMT

Australia's Roc Oil said Tuesday that it has started drilling the second well in the Zhanghai block in the Bohai Bay offshore China.

The ZD CP2N-H-2 well in the Zhanghai block, along with the Chenghai block, was included in Roc's existing Zhao Dong block contract in March last year to tie-in previous adjacent discoveries.

The well was drilled from the Zhao Dong C4 platform on Monday, with a total planned depth of 3,283 meters.

"If successful and commercial, this well will be tied-in to existing Zhao Dong facilities," Roc said in a statement.

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The H-2 well will be funded 80% by Roc and the remainder by its partner Sinochem.

State company PetroChina in August 2011 exercised its right under the production sharing contract to participate in the first H-1 well in Zhanghai, which was successful and subsequently tied in to the existing Zhao Dong production facilities.

This will bring PetroChina's share in any developments in the two new additional blocks to 51%, reducing Roc's stake to 39.2% and Sinochem's interest to 9.8%.

The H-2 well is the final one for the block under the minimum exploration and development work stipulated by the production sharing contract.

Meanwhile, Roc said it was continuing to pursue other opportunities for further development in the Zhao Dong area.

The Zhao Dong block produced over 18,000 b/d gross in the first quarter of this year.

Separately, Roc said it has spudded the Balai 2 well in the Balai cluster offshore Sarawak in east Malaysia.

This is the second well in the pre-development phase appraisal drilling program, and it is located in the Balai field.

Roc is operator of the contract with a 48% stake. The other partners are Malaysian Dialog Group (32%) and state company Petronas' upstream arm Carigali (20%).

On November 19, Roc announced completion of the initial testing of the Bentara-2 well as a successful oil discovery in the Bentara field, located 25 km west of Balai.

The Balai cluster consists of the Bentara, Balai, Spaoh and West Acis fields. Appraisal drilling is part of the pre-development phase which commenced early this year. Upon successful completion and agreement on the economic viability of the fields, Roc and its partners will submit a field development plan.

--Song Yen Ling, yen_ling_song@platts.com --Edited by Elston Soares, elston_soares@platts.com

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