Oryx Petroleum Loses $423m in 2015

2016 Operations Update:

  • Successful re-completion of the Demir Dagh-3 well in the Jurassic reservoir in January 2016
    - Flowed at 1,000 bbl/d for 7 days before being shut-in due to full storage; production successfully processed through Train 2 of the Demir Dagh production facilities
    - Samples indicated 40° API oil with 2 - 4% water cut
  • - Expected gross (100%) productive capacity of 2,000 to 3,000 bbl/d from the Jurassic
  • Limited production and oil sales in January and February 2016 due to temporary Turkey-Iraq border closures and restrictions on export by trucking
  • Completion of tie-in and commissioning of pipeline infrastructure to export oil via the Kurdistan Export Pipeline to Turkey in early March 2016
  • Commencement of pipeline export sales on March 14, 2016
    - Current gross (100%) production of 1,700 bbl/d from three wells with expectation to increase to full productive capacity of 4,000 bbl/d to 7,000 bbl/d in the coming weeks
    - Expectation that most future production will be exported via pipeline
    - Revenues to be based on realisations of Brent crude less a $10-$15 per barrel discount for transportation and quality differentials versus comparable discount of $26 per barrel for previous trucking exports
  • $30 million cash investment and proposed $20 million work commitment from Zeg Oil and Gas Ltd (“Zeg Oil”) announced on March 1, 2016 (the “Zeg Oil Strategic Investment”)(See the section titled “Strategic Investment ” below)
  • Implementation of re-organisation announced March, 1, 2016 to result in substantial cost savings
    - Vance Querio, previously Chief Operating Officer, appointed to assume Michael Ebsary’s responsibilities as Chief Executive Officer effective March 16, 2016 and will retain the responsibilities of the Chief Operating Officer
    - Overall headcount to be reduced from 245 as of June 30, 2015 to 104 upon expiration of notice periods, and headcount in Geneva, Switzerland to be reduced from 72 to 15
    - General & administrative and technical support expenditures to be approximately 50% lower in 2016 versus 2015 with further reductions expected in 2017
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