10th Sep 2008 07:00
Emerald Energy Plc
10 September 2008
Khurbet East Field Update, Block 26, Syria
Emerald Energy Plc ("Emerald" or the "Company") would like to provide the following update on activities in the Khurbet East field in Block 26, Syria.
Following the completion of start-up operations that commenced with Khurbet East No.4 on 21 July, the Khurbet East field is now producing at a stabilised rate in excess of 11,500 barrels of 25.7 degrees API gravity oil per day from three vertical wells (Nos. 2, 3 and 4) and two horizontal wells (Nos. 5 and 6).
A pressure monitoring programme designed to gather information on the performance of individual wells and the Cretaceous Massive reservoir was completed on 5 September 2008. The programme involved recording the bottom-hole pressure in the wells while sequentially flowing and shutting in each of the wells. This information will be used for reservoir management and future field development purposes.
Average oil production during August was 5,600 barrels per day with only trace amounts of water present in the oil. Cumulative oil production to date is over 260,000 barrels. The produced oil has been delivered by trucks to a receiving facility operated by the Syrian Petroleum Company approximately 33 kilometres by road from the Khurbet East field.
The crude oil produced from the Khurbet East field has been determined to have specifications similar to those of the Syrian heavy crude oil. Under oil marketing arrangements agreed with Syrian Petroleum Company ("SPC") and the Oil Marketing Bureau of the Syrian Government ("OMB"), oil produced from the Khurbet East Field will be sold as Syrian heavy crude oil which has an API of approximately 24.1, and exported through the Mediterranean port of Tartous using SPC's oil handling infrastructure. However, in the period to September 2009, under the OMB's arrangements for marketing oil produced from newly developed fields in this area, the Company will be receiving 80 per cent of the official price of the Syrian heavy crude oil, with the settlement for the remaining unpaid amount, subject to any adjustments for variations in oil quality, taking place in September 2009. After completion of this initial oil analysis process OMB will then pay, without retention, 100% of the selling price as determined for the measured oil quality.
Emeralds' Chief Executive Officer, Angus MacAskill, said:
"We are very pleased with the successful completion of the production start-up phase of Khurbet East field operations and to have reached stabilised production levels in excess of the original plans. We look forward to the field's contribution to the Company's production and cash flow and also to further field development."
Enquiries: Lisa Hibberd 020 7925 2440
Related Shares:
Emerald Energy