ShaMaran Full Year Results

ShaMaran Petroleum has announced its financial and operating results for the year ended December 31, 2012. Unless otherwise stated all currency amounts indicated as “$” in this news release are expressed in thousands of United States Dollars.

Highlights

  • The Company announced on February 4, 2013 an increase of 35% in Best Estimate 2C Contingent Resources (gross) for the Atrush Block, from 465.6 MMBOE at December 31, 2011 to 627.3 MMBOE at the end of 2012. The estimates were provided by an independent qualified resources evaluator, McDaniel & Associates Consultants Ltd., in a Detailed Property Report prepared as at December 31, 2012.
  • On November 7, 2012 General Exploration Partners Inc. (“GEP”) then operator of the Atrush Block and acting on behalf of the Contractor Group under the Atrush Block Production Sharing Contract, submitted to the Atrush Block Management Committee a Declaration of Commercial Discovery with effect from November 7, 2012.
  • The Atrush-2 appraisal well was spudded on May 23, 2012 and a total depth of 1,750 meters was reached ahead of schedule on July 10, 2012. Following the conclusion of the comprehensive well testing program the Company announced on September 13, 2012 that the main reservoir in Atrush-2 produced a combined flow rate from three separate cased hole tests of more than 42,200 barrels of oil per day (“bopd”) and that additional oil resources were confirmed in two additional formations.
  • The Company announced on August 20, 2012 that it sold its entire 20% direct interest in the Taza production sharing contract (“PSC”) to a subsidiary of Total S.A. for a $48 million purchase price plus a reimbursement of costs incurred on joint operations from April 1, 2012 until the closing date.
  • The Company signed final binding agreements with the Kurdistan Regional Government (“KRG”) in January 2012 to relinquish the 60% working interests previously held in each of the Arbat and Pulkhana PSCs. An amount of $25 million was paid in January 2012 to the KRG as relinquishment fees to fulfill all outstanding financial commitments on these two blocks. The agreements relieve the Company of any further obligations under these PSCs. Disappointing testing results from the Pulkhana 9 well led the Company to this decision.
  • In August 2012 the Company repaid in full the short term loan of $10 million which had been obtained in April 2012 from two related parties.
  • The cash balance of the Company was $41.2 million as at December 31, 2012 (2011: $49.1 million).
  • On March 12, 2013 the Contracting entities to the Atrush Block PSC were notified by the KRG that it had exercised its option to acquire a 25% Government Interest in accordance with the provisions of the Atrush Block PSC.
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