9th Sep 2009 07:00
Emerald Energy Plc
9 September 2009
Operations Update - Syria, Block 26
Emerald Energy Plc ("Emerald" or the "Company") is pleased to provide the following update on operations in Block 26, Syria.
Khurbet East Field Oil Production
Cumulative gross oil production from the Khurbet East field has recently reached 4 million barrels, with minimal water production to date.
Khurbet East No.12 Delineation Well
Drilling operations have been completed at Khurbet East No.12, a vertical delineation well located approximately 3.2 kilometres south of the Khurbet East No.8 vertical well, previously the most southerly well drilled in the field.
Khurbet East No.12 was drilled to a total measured depth of 2,070 metres, encountering the top of the Cretaceous Massive reservoir at a measured depth of 1,984 metres, equivalent to 1,592 metres true vertical depth subsea ("TVDSS") and 22 metres deeper than the 1,570 metres TVDSS level interpreted as the best estimate of the oil-water contact for the purpose of determining reserves.
Shows of viscous oil were recorded while drilling through the reservoir and approximately 6 metres of core was recovered near the top of the reservoir. Preliminary analysis of core and wire-line logs indicates approximately 10 metres of net reservoir, extending down to 1,605 metres TVDSS, with an average porosity of 18%. The reservoir parameters and oil quality appear similar to those encountered in Khurbet East No.8 but the average oil saturation is interpreted to be significantly less in the Khurbet East No.12 well. The lower oil saturation levels seen in this well may be due to an extended transition zone or to oil remaining from migration into the field.
A wire-line formation pressure and fluid sampler measured formation pressures at depths of approximately 1,992 metres (1,600 metres TVDSS) that are interpreted to be consistent with the oil pressure gradient previously observed in the Khurbet East field. However, three fluid samples recovered by this wire-line tool from the same depth contained formation water. Flow testing operations are planned to be conducted at Khurbet East No.12, following demobilisation of the drilling rig from the well location, to determine the fluids that will be produced under production conditions.
Khurbet East No.11 Flow Testing
Initial flow testing of the Khurbet East No.11 horizontal development well over a one week period has been completed. The 60 metre horizontal section in Khurbet East No.11 well penetrates the top of the Cretaceous Massive reservoir at approximately 1,540 metres TVDSS and ends at approximately 1,562 metres TVDSS.
The well flowed oil of approximately 25 degrees API at an average rate over a 44 hour period of approximately 1,660 barrels per day, under natural flow and through a 48/64" choke, with a water cut of approximately 30%.
Further production monitoring operations are planned to be conducted to determine the source of the water production and a remedial water shut-off operation may be undertaken which may allow production from this well to be received at the Early Production Facility.
Yousefieh No.1 Remedial Cementing and Flow Testing
The Yousefieh No.1 well, drilled in November 2008, was re-entered in August 2009 to conduct remedial cementing operations on the production liner and to subsequently flow test the well.
Remedial cementing operations were conducted successfully and the production liner was then perforated across a 14.5 metre interval between 1942.5 metres and 1957 metres. During subsequent flow testing operations the well flowed oil of approximately 25 degrees API to surface at an average rate of approximately 356 barrels per day over a 7 hour period, under natural flow and through a 48/64 inch choke, with an average water cut of less than 1%. Under artificial lift with nitrogen and through a 2 inch choke, the well flowed over a 2 hour period at an average oil rate of approximately 824 barrels per day with a water cut of less than 1%.
Yousefieh No.1 is now being completed for future production.
Yousefieh No.2 Flow Testing
The Yousefieh No.2 well, drilled in February 2009, was re-entered in August 2009 to evaluate the flow potential of the interval between 1,978 and 1,991 metres which, based on wire-line logging information, was interpreted to contain oil but had previously not flowed to surface. Using a work-over rig, a production liner was set over the open-hole section and an acid stimulation was conducted across the potential reservoir interval.
Following the acid stimulation operation, the well flowed 17 degrees API oil to surface at an average rate of 139 barrels per day over a 12 hour period, under artificial lift using nitrogen and through a 2 inch choke, with a water cut of 49%.
Yousefieh No.3 Appraisal Well
Following demobilisation from the Khurbet East No.12 well location, the drilling rig will move to commence drilling operations on the Yousefieh No.3 appraisal well, located approximately 500 metres to the south-east of the Yousefieh No.1 discovery well. The Yousefieh No.3 well is planned to take approximately 45 days to drill and evaluate.
Emerald's Chief Executive Officer, Angus MacAskill, said:
"We are very pleased with the production performance experienced in the Khurbet East field and the continued progress with the delineation and appraisal of Khurbet East and Yousefieh fields. We look forward to the results of flow testing at the Khurbet East No.12 well and the results of the upcoming Yousefieh No.3 appraisal well."
Enquiries: Lisa Hibberd 020 7925 2440
Dealing Disclosure Requirements
Under the provisions of Rule 8.3 of the City Code on Takeovers and Mergers (the "Code"), if any person is, or becomes, 'interested' (directly or indirectly) in 1% or more of any class of 'relevant securities' of the Company, all 'dealings' in any 'relevant securities' of the Company (including by means of an option in respect of, or a derivative referenced to, any such 'relevant securities') must be publicly disclosed by no later than 3.30pm (London time) on the London business day following the date of the relevant transaction. This requirement will continue until the date on which any offer becomes, or is declared, unconditional as to acceptances, lapses or is otherwise withdrawn or on which the 'offer period' otherwise ends. If two or more persons act together pursuant to an agreement or understanding, whether formal or informal, to acquire an 'interest' in 'relevant securities' of the Company, they will be deemed to be a single person for the purpose of Rule 8.3.
Under the provisions of Rule 8.1 of the Code, all 'dealings' in 'relevant securities' of the Company by any offeror or the offeree company, or by any of their respective 'associates', must be disclosed by no later than 12.00 noon (London time) on the London business day following the date of the relevant transaction.
A disclosure table, giving details of the companies in whose 'relevant securities' 'dealings' should be disclosed, and the number of such securities in issue, can be found on the Takeover Panel's (the "Panel") website at www.thetakeoverpanel.org.uk.
'Interests in securities' arise, in summary, when a person has long economic exposure, whether conditional or absolute, to changes in the price of securities. In particular, a person will be treated as having an 'interest' by virtue of the ownership or control of securities, or by virtue of any option in respect of, or derivative referenced to, securities.
Terms in quotation marks are defined in the Code, which can also be found on the Panel's website. If you are in any doubt as to whether or not you are required to disclose a 'dealing' under Rule 8 you should consult the Panel.
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