This therefore gives rise to uncertainty in the timing of revenue recognition and guidance for 2014. At this time, revenue guidance for 2014 is in the range of US$150 million to US$180 million which reflects the Company's current view on cash payment and current production levels.
Production and Infrastructure
- Shaikan PF-1 is currently producing from three wells, Shaikan-1, -3 and -4.
- Hook-up of Shaikan-8 and Shaikan-7 to PF-1 is expected later in 2014; flowlines are being ordered.
- Shaikan PF-2 has been commissioned and the start-up process has commenced with live oil flowing from Shaikan-5 to the production facility, which will also be producing from Shaikan-2 and -10.
- Flowlines are being ordered for an additional development well to be drilled and hooked-up to Shaikan PF-2.
Exploration
- Due to a number of mechanical failures in the course of the drilling operations, the Shaikan-7 deep exploration well has not been able to achieve its objective and will now be converted into a Jurassic producer and tied into Shaikan PF-1. Based on well logs, Shaikan-7 should become a prolific producing well and the full cost of the well should be recovered within six months from first production.
- A new deep exploration well to test the previously undrilled deep Triassic and potentially Permian horizons, which is a commitment under the approved Shaikan Field Development Plan, will be added to the drilling schedule.
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