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Cliff Head hit by another cost blowout

The Cliff Head oil project has reported a three-week delay and a further 7.5 per cent cost increase, adding to a long and expensive list of cost increases.
The project, operated by Roc Oil in the offshore Perth Basin, is now expected to cost a total of $285 million.
That compared with the $227 million budget estimate 12 months ago, when Roc and its joint venture partners committed to proceed with the project.
That, in turn, was well above the original budget estimate of $156 million provided in April 2004.
The increases partly reflect changes in the project scope but mostly reflect the cost pressures facing the resources and construction sectors, which are being affected by rising material prices, labour shortages and equipment delays.
Roc also announced that commissioning of the project was well advanced.
It said that "on a problem-free basis" the first two oil production wells are expected to be ready to deliver their first oil by mid April 2006.

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