12th Jan 2015 07:35
LONDON (Alliance News) - Afren PLC on Monday said it is considering its options for the Barda Rash field in the Kurdistan region of Iraq after the reserve estimate for the prospect was revised down substantially.
Afren said an updated competent person's report on the Barda Rash field is expected to show a material reduction to its previously-published estimates on reserves and resources.
The FTSE 250-listed explorer said it expects the total reserve estimate for the field to be revised down to 250 million barrels of oil from 1.24 billion barrels previously.
The downgrade has been made due to the reprocessing of 3D seismic surveys undertaken in 2012 and processed in 2013, alongside results of its most recent drilling campaign. The reservoirs have not performed according to previous expectations, Afren said, while the wells have encountered higher water cuts than expected, and the company has seen operational challenges associated with drilling complex fractured reservoirs.
As a result of the downgrade, Afren said it is now considering strategic options for Barda Rash, though it said it would complete its commitment to finish testing on the BR-5 well at the site.
"We are naturally disappointed with the report and will now consider our strategic options for Barda Rash. Meanwhile, we will continue to focus on our core portfolio in Africa and allocate capital to our highest cash return projects," said Afren Interim Chief Executive Officer Toby Hayward.
By Sam Unsted; [email protected]; @SamUAtAlliance
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