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Figure 23 – OSOCO Production Profile
(bopd) 2,500 2,000 1,500 1,000 500 0 2010
The development plan for the OSOCO 1P reserves is presented below. (Costs in 2010 terms) Year (kbopd) 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 Source: Company. Production (kbopd) 2.04 2.08 1.74 1.38 1.10 0.86 0.66 0.53 0.43 0.35 0.28 0.23 0.19 0.15 0.12 0.06 0.04 Opex (US$mm) 3.7 3.8 3.2 2.5 2.0 1.6 1.2 1.0 0.8 0.6 0.5 0.4 0.3 0.3 0.2 0.1 0.1 Side-Track Well (US$mm) 3.5 -----------------
Shukheir Offshore Oil Price
Oil produced from Shukheir Bay is currently benchmarked to Ras Gharib crude which has traded at a 20% discount to Brent in the 2008 - 2009 period. As of January 2010, Ras Gharib has been trading at a c. 9% discount to Brent and is expected to remain so going forward. The Company is currently awaiting approval from EGPC to benchmark a major portion of the Shukheir Bay production to Ras El Bihar crude which has traded at a 3% discount in the 2008 - 2009
The Company is expecting the Shukheir Bay crude to start trading at a 3% discount by October 2011.331. based on the current ongoing in-house reservoir engineering study is 2. This Lower Rudeis upside potential is currently under evaluation before being drained by infill wells. Moreover. The capex will be spent on the installation of necessary pumps to accommodate for the change in the evacuation of crude. The upside potential is currently under evaluation. Gamma-1 and EWD-1 ST1 as described below: Well GA-12 Updip Area: An upside potential in Nubia has been identified in an updip area to the well GA-12 which encounters the top of Nubia.4 million of capex in 3Q 2011. the Company will have to spend US$ 1. predominantly identified through wells GA-12. oil produced from Gamma is currently benchmarked to Ras El Bihar crude. The production 21 . will require a thorough evaluation of its hydrocarbon potential on receipt of the 3D seismic data currently being re-processed. Additional estimated resources in the Nubia reservoir.Investment Opportunity period. An optimum location to drain the estimated reserves will be recommended upon completion of the current study. Source: Company. to the east of EWD-1 well. Well West Gamma-1 Updip Area: A promising area in view of the intermittent production of the West Gamma-1 well and the Lower Rudeis gas shows indicated by the GA-12 well.65 mmbbl. Gamma Upside Potential The Company has identified upside potential in several updip areas in the Gamma Field. 57 m below the field’s oil water contact (1. In order to achieve the 3% discount. Figure 24 – Gamma Nubia Upside Potential Figure 25 – Gamma Rudeis Upside Potential Source: Company. Lower Rudeis upside potential is evidenced from the oil and gas shows encountered at a downdip location in the Lower Rudeis sandstones.5 mss). The following chart illustrates the production forecast including the upside potential in SHB and Gamma Fields. Well East Wadi Dara Updip area: A potential Lower Rudeis sand updip area.
(Costs in 2010 terms) Year (kbopd) 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 Source: Company.06 0.3 0.6 0. as the two other scenarios are currently under evaluation.45 2.4 1.5 ----------------Exploration (US$mm) 6.6 1.02 0.35 0.000 500 0 2010 2011 2012 2013 SHB-1 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 Gamma-1 SHB-5 SHB sidetrack G12 up dip Source: Company.12 0.04 Opex (US$mm) 3.500 1. Budgeted capital/operating expenditure for the development of Gamma for the year 2010 includes the drilling of one exploratory well with an estimated cost of US$6 million (GA-12 Updip). Operating expenses are estimated at US$5 /boe.8 0.1 0.3 6.70 1.98 3.96 1.000 1.4 0.0 ----------------- 22 .77 0.500 2.2 0. The development plan for the 1P reserves and upside from OSOCO is presented below.04 3.15 0.500 4.42 1.9 3.45 0.6 2.9 1.19 0.23 0.1 Side-Track Well (US$mm) 3.58 0.500 3.000 3.3 4.000 2.7 7.Investment Opportunity forecast takes into account the GA 12 updip scenario with respect to the Gamma Field.3 0.1 0. Figure 26 – Total OSOCO & Upside Potential Production Profile (bopd) 4. Production (kbopd) 2.
2007. 23 . which comprises the 36” Inter-Sinai National Gas Pipeline and the national coastal asphalt road to El Arish.828 line km of 2D seismic data. a petrophysical evaluation and bio-stratratigraphy analysis of available wells (reprocessing a total of 1. Moreover. The nearest are the onshore Fayrouz and Rommana discoveries to the west (Gas & Condensate in Early Miocene). 3D seismic data covering an area of 320 km2 is in the process of being processed following survey completion in mid December 2009. It is currently envisaged that it will take approximately four months to complete the processing.887 line km) and conducted a Geosat Study (phase I). Under the Production Sharing Contract (“PSC”). with drilling of the first exploratory well scheduled for the 2nd quarter 2010. As of the effective date. Previous operators of the concession drilled seven wells. EGAS has designated an area adjacent to the NEM concession where any contractor may construct their facilities. It benefits from good infrastructure exits at the northern part of the concession. of which two wells had good gas shows. thereby significantly reducing the processing time for the permits required for the construction of facilities.120 km2 in North Sinai and is bound from the south by Gabal Magharah and by the Mediterranean shore line from the north.1 Overview of Exploration Concessions North El Maghara (“NEM”) Exploration Concession Concession Overview The Company received the award letter for the NEM concession in the EGAS 2006 bid round. the Company has carried out a detailed geological assessment of the area. the onshore Raad Field to the east (Gas in Mid Cretaceous). the Thekah Offshore Field to the northwest (Gas in Pliocene). between 1973 and 1986. Figure 27 – Geographic Location Source: Company. The concession covers an onshore area of 3.Investment Opportunity 4 4. Several oil and gas discoveries have been found around the concession. acquisition of new 3D seismic and the drilling of two exploration wells. The concession is covered by different seismic vintages totalling 2. the offshore Tinah discovery (Oil in Oligocene) and the offshore Mango discovery to the NE (Oil in Early Cretaceous). with an effective date of July 17. the Company has a financial commitment to invest US$8 million over the initial exploration period of three years for the following activities: reprocessing of old seismic data.
oil discoveries have been made in the offshore Mediterranean. Stratigraphy. to the north of the concession. is characterized by a thick deltaic Tertiary sequence of OligoceneNeogene sediments with the Cretaceous-Jurassic sequence deeply buried. The Mid-Delta Hinge Zone. on the other hand. In addition. Figure 28 – North Sinai Generalised Stratigraphic Column Source: Company. Additional target reservoirs are the sands and porous carbonates within the Jurassic and Cretaceous sequences. in the Oligocene (Tineh Field) and in the Early Cretaceous (Mango-1 well). 24 . runs across and separates the concession into northern and southern parts: The southern part is affected by the Late CretaceousMid Eocene Syrian Arc folding and thrusting and is represented by a carbonate platform of reduced Tertiary section with shallow near surface Cretaceous-Jurassic sediments. The northern part. as well as the turbidites and clastics pinch-outs within the Oligocene to Early Miocene sediments. comprising the Pliocene and the Late Miocene (Abu Madi) braided channels. are known to have good potential for active hydrocarbon generation and can act under favourable conditions as hydrocarbon generators. The region of North El Maghara was affected by several major tectonic events that created two pronounced sedimentary regimes in the concession. comprising the Tertiary Nile Delta and the Mesozoic West Desert / North Sinai sedimentary sequences. Reservoirs and Structure Figure 28 presents the generalised stratigraphic column of North Sinai. Pronounced structural traps are mainly concentrated in the southern platform area and are represented by faulted anticlines trending NE-SW. while stratigraphic traps are mainly of Tertiary age and concentrated in the northern basinal part of the concession. ranging from Miocene to Jurassic. Several stratigraphic sequences in the geological column of North Sinai. to the north of the Hinge Zone. confirming the presence of active petroleum systems in both the Miocene and pre-Miocene sequences in the area. The Late Cretaceous-Miocene carbonates also have potential for development of local high energy build-ups around the Mid-Delta Hinge Zone. The main target reservoirs in concession are the Tertiary sands.Investment Opportunity Exploration History and Activities Several gas and oil discoveries were made around the concession at different stratigraphic levels. which is a steep tectonic flexure. Figure 29 – NEM Structure Framework Source: Company. Both structural and stratigraphic traps are identified in the concession. Gas discoveries have been made in nearby wells in the Pliocene and Mid Cretaceous sections and gas and condensate have been recovered from the Early Miocene.
not e ocene or the M to Mid Early Miocene seismic anom E e malies identified on the reproc d cessed data (shown in the figu below). within th Early Mioce I he ene-Oligocene sequence. ped Indications of possible sand bars. The geom metric configur ration and seis smic character of the identified chan i nnels show gre similarity to those gas pro eat o oducing chann in the near Nile Delta area to the we In nels rby est. are al reflected on several old se lso n eismic sections s. addition. Early evaluatio of North El Maghara bid r E on round documen from 2006 r nts revealed the pr resence of six m channels at the main Late Miocene (Abu Madi) level. and carbonate bu d uild-ups at the H Hinge Zone. some of w L which are confir rmed by the re ecently reprocessed data. within th Late Cretaceous/Eocene se Z he equence. gas sh a hows were rec corded in two w wells drilled clo to the ident ose tified and mapp channels. Source: Compan ny. The gas resour T rces in place f the six Late Miocene cha for e annels are estim mated at 748 b for the Mos Likely case (P50) bcf st and 1.Inve estment Oppor rtunity North El M N Maghara Identified Lead and Pros ds spect Interpretation of old and rep I processed seism data indica mic ated the presen of several braided chann in the nort nce nels thwest part of the con p ncession at seve Pliocene a Miocene le eral and evels.447 bcf for the Maxim a f mum case (P10 The above estimates do n include the potential Plio 0). So ource: Company. ure Figure 30 – M to Early M Mid Miocene Stratigraphic Lead c Figure 31 – P Pliocene Stratigraphic Lead c Fi igure 32 – Mid to Early Miocene d St tratigraphic Le ead Source: Compan ny. .
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