29th Feb 2016 09:09
LONDON (Alliance News) - Genel Energy PLC Monday said it expects to book a USD1.00 billion impairment in its 2015 financial results against the Taq Taq field in Iraq and said the reserves within the field have fallen substantially following an internal review.
Genel said last month it was conducting a review of its reservoir model at Taq Taq following declines in production from the field during 2015. The review is being carried out by McDaniel & Associates, which is almost complete.
McDaniel & Associates is the same company that carried out the previous audit of the Taq Taq reserves back in 2011, which stated the field was capable of potentially producing 683 million barrels of oil over its lifetime.
However, the latest audit now suggests the field will only produce 356 million barrels of oil over its lifetime - almost half the previous estimate.
Importantly, the Taq Taq field had already produced 184 million barrels before the end of 2015, meaning Genel only has around 172 million barrels left to extract from the field.
Genel said it expects gross production from the field to average 80,000 barrels a day in 2016 before falling to a range of 65,000 to 75,000 barrels a day in 2017 and 50,000 to 70,000 barrels a day in 2018.
Genel said it still expects net production from the field to be around 60,000 to 70,000 barrels a day this year.
Genel shares were down 24% to 94.89 pence per share on Monday morning.
By Joshua Warner; [email protected]; @JoshAlliance
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