Genel Energy plc issues the following trading and operations update in respect of Q3 2016. The information contained herein has not been audited and may be subject to further review.
Murat Özgül (pictured), Chief Executive of Genel, said:
"Genel has received $163 million in cash proceeds during 2016, underpinning the drilling of successful production wells across Taq Taq and Tawke.
"The KRG has made significant progress in restructuring the region's economy. With export volumes at Ceyhan having increased following a new deal with the federal government, and the recent recovery in the oil price, this bodes well for the region's cash flows. Despite the recent delay in payments, we remain optimistic that they will continue, facilitating further investment across our KRI assets."
Q3 2016 OPERATING PERFORMANCE
- Q3 2016 net production averaged 53,100 bopd, an 8% decrease on the previous quarter
- Production and sales by field during Q3 2016 were as follows:
- Production by field for the nine months ending 30 September 2016 was as follows:
- At Taq Taq (Genel 44% working interest) two side-track wells, TT-27x and TT-07z, were successfully drilled and completed during the period, partially offsetting the decline from existing wells. A third side-track, TT-16y, is in progress. Taq Taq production in October to date has averaged 50,000 bopd
- Through development drilling and reservoir management, the focus at Taq Taq remains mitigating field declines and reducing the concentration of production from the crest of the field
- The Company is currently in the process of preparing a revised Field Development Plan ('FDP') for Taq Taq, which is expected to be completed in early 2017. The revised FDP will establish the next phase of the development plan, notably with respect to new development well locations and the overall reservoir management strategy, while also identifying necessary resources and technologies required to implement future activity. In advance of the FDP completion, a tender has been initiated to procure a more powerful drilling rig for the start of 2017, which would provide greater optionality around development drilling at Taq Taq
- Tawke (Genel 25% working interest) production in Q3 2016 was in line with the first half of the year. Development activity recommenced during the period, with the Tawke-32 (Jeribe water injector), Tawke-33, Tawke-34 (Jeribe producers), and Tawke-31 (Cretaceous producer) wells all being drilled. The Tawke-37 (Jeribe producer) was drilled post period end, with all wells in the current campaign adding to field output capacity. Tawke production in October to date has averaged 105,000 bopd, with current production levels at 120,000 bopd
- The Peshkabir-2 appraisal well on the Tawke licence commenced drilling in early October and is expected to take around three months to complete
- On the Chia Surkh PSC, work continues to establish a low cost development solution for the discovered Tertiary oil resources, which are currently estimated at 3-10 mmbbls. An FDP submission is targeted by the end of 2016. Consequently, the Company expects to write down the Chia Surkh carrying value to a nominal amount. At end 2015, the Chia Surkh carrying value was $198 million