Genel Releases Full Year Results


In November 2013, the Government of Turkey and the KRG signed a Gas Sales Agreement governing the export of natural gas from the KRI to Turkey. The GSA calls for an initial 4 bcma of gas exports from 2017, rising to 10 bcma by 2020 and the option of increasing to 20 bcma thereafter. Miran and Bina Bawi will be anchor suppliers under the GSA - a significant milestone in the commercialisation of the major gas resource in both fields.

Miran (75% working interest, operator)

Genel Energy has a 75% interest in the Miran discovery, which is one of the largest undeveloped gas discoveries in the KRI. The field has independently audited mean contingent resources of 3.5 tcf of gas and 95 mmbbls of oil and condensate. On 1 September 2013, the KRG approved the Declaration of Commerciality for the Miran field. On 23 February 2014, the KRG notified the Company of its intention to exercise its option to take a 25% interest in the Miran PSC, thereby reducing Genel Energy's interest from 100% to 75%.

Building on the success of the Turkey-KRG GSA, discussions with the KRG have commenced with the aim of finalising a Gas Sales Offtake Agreement for the Miran field in the second half of 2014. In parallel, we continue to screen a number of development concepts, incorporating both domestic and export supply options.

The Miran West-5 (MW-5) appraisal well was spudded on 4 July 2013 but mechanical difficulties resulted in the well being suspended. A decision was made to swap rigs before recommencing drilling, and results from the MW-5 well are now expected in the third quarter of 2014, to be followed by an extended well test.

The primary gas bearing reservoir in the Miran discovery is the Jurassic. Technical work has established the potential for deeper gas bearing zones in the Triassic and Permian in a separate structure. These targets comprise the Miran Deep prospect which is expected to be drilled in 2015.

An Extended Well Test on the oil bearing lower Cretaceous reservoirs was commissioned in early 2013, with the Miran-1 well flowing at rates over 4,000 bopd. Given this encouragement, an Early Production Facility (EPF) was sanctioned and commissioned in August 2013, producing at 500-1,500 bopd. The EPF is to be suspended in the first quarter of 2014 in preparation for drilling the first horizontal development well into the Miran oil reservoir. Spud is expected around mid-year 2014, and the results of this well will be important in shaping future oil development on the licence.

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