By John Lee.
In its Trading Statement this morning, Dragon Oil issued the following update on its operations in Iraqi Kurdistan:
"On 10 September 2014, the partners in Block 9 in Iraq, Dragon Oil (30%) and Kuwait Energy (70% and operator), announced their first oil discovery at the consortium's first target, the Mishrif formation, reached at 2,700 meters, in the Block 9 exploration well, Faihaa-1. Preliminary open hole tests of the Faihaa-1 Mishrif formation resulted in a flow rate of c. 2,000 bopd and 3,400 bopd of 20 API oil on a 32"/64" and 64"/64" chokes, respectively.
"Later in the year, in December, the partners reported their second oil section discovery in the second target, the Yamama formation, reached at 4,000 meters in the same Faihaa-1 exploration well. Preliminary open hole tests of the Faihaa-1 Yamama formation resulted in oil flow rates of c. 5,000 and 8,000 bopd of 35 API crude oil on 32"/64" and 64"/64" chokes, respectively.
"The report from an independent petroleum engineer incorporating the results of testing the Mishrif formation indicated contingent 2C oil resources of 198 million barrels and contingent 2C gas resources of 56 Bscf net to Dragon Oil on a working interest basis.
"More detailed testing on both formations will be conducted in the cased hole to help evaluate the commerciality of the findings. The consortium's strategy is to accelerate the evaluation of the Faihaa-1 discovery by drilling two appraisal wells in 2015 in order to fast track the development."
(Source: Dragon Oil)