Genel Energy Outlines 2016 Plans

By John Lee.

In its trading update this morning, Genel Energy gave the following plans for its operations in Iraqi Kurdistan:

The majority of planned activity and capital expenditure in the KRI is discretionary, which confers significant flexibility. The Company will leverage this flexibility and match activity to the level of cash proceeds received from export payments and domestic KRI sales

KRI oil production assets

  • At Taq Taq (Genel 44% working interest, joint operator), the proposed 2016 work programme consists of installation of electric submersible pumps (‘ESPs’) in existing wells, sidetracks of existing wells and drilling of new horizontal wells. Final completion and commissioning of the second Central Processing Facility (‘CPF’) is expected in Q1 2016. The proposed 2016 Taq Taq work programme contains both firm and contingent elements
  • At Tawke (Genel 25% working interest), the proposed 2016 work programme includes drilling of new development and water disposal wells and the construction of water handling facilities at the existing CPF as part of contingent activity
  • Actual levels of activity across both assets in 2016 will depend on the regularity and quantum of export payments, as well as the technical results of the work programme
  • Capital expenditure net to Genel from the proposed work programmes across both Taq Taq and Tawke is estimated at $50-90 million

KRI gas business

  • At Miran (75% working interest, operator) and Bina Bawi (80% working interest, operator), 2016 activity will focus on delivering the upstream gas development plan and geological/geophysical studies. Work will also commence on the front end engineering design and financing plans for the midstream gas processing. Capital expenditure for the KRI gas project during 2016 is estimated at c.$25 million (which partly reflects capitalisation of pre-sanction development activity)

KRI exploration and appraisal

  • At Chia Surkh, the sale of a 20% interest in the licence to Petoil has completed after receipt of KRG approval. As a result, Genel now has a 40% working interest in the Chia Surkh PSC. The CS-12 appraisal well is scheduled to be drilled in H1 2016. The drilling will help refine the contingent resource estimate for the Chia Surkh licence, with Genel carried by Petoil for its costs on CS-12
  • Genel and its partner in the Ber Bahr PSC have decided to relinquish the licence in light of prevailing oil prices and an assessment of resource potential. The Company has also decided to exit its interest in the Dohuk PSC

(Source: Genel Energy)

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