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1. Emerald Energy is talking up the potential of its Tigris structure onshore Syria, where drilling of the Tigris-1 well is expected to commence in September. The company highlighted new information released by operator Gulfsands Petroleum, the operator of Block 26 , following an economic valuation by Ryder Scott Company, L.P. The latter has completed an economic valuation of the probable and possible reserves (unrisked) on Tigris, which can be viewed on Emerald's website ( www.emeraldenergy.com ). On 30 January 2006, Ryder Scott completed a reserves study on the Tigris structure in which two cases were considered as there was insufficient data available at that time to determine with certainty the hydrocarbon fluid contained within the structure. This reserves study classified probable and possible reserves and prospective resource as follows: If Tigris is a natural gas accumulation, Ryder Scott has classified 442 Bcf of gas as probable reserves, a further 442 Bcf of gas as possible reserves, and a further 3.447 Tcf of gas as a prospective resource. In summary, total estimated hydrocarbon potential for probable and possible reserves and prospective resource in this case is 4.33 Tcf of gas, equivalent to 722 million boe. If Tigris is an oil accumulation, Ryder Scott has classified 104 million bbl of oil and 64 Bcf of gas as possible reserves and a further 408 million bbl of oil and 245 Bcf of gas as prospective resource. In summary, total estimated hydrocarbon potential for possible reserve and prospective resource in this case is 512 million bbl of oil and 308 Bcf of gas, equivalent to 563 million boe. If Tigris is a natural gas accumulation, Ryder Scott determined the probable reserves net to Emerald after applying the fiscal terms of the production sharing contract are 102 Bcf of gas having a net present value, discounted at 10%, of $233 million. In addition, the accumulation rates 75 Bcf of gas of possible reserves net to Emerald having a net present value, discounted at 10%, of $261 million. In summary total estimated probable and possible reserves for the natural gas case is 177 Bcf of gas (30 million boe) with a net present value of $494 million. If Tigris is an oil accumulation, Ryder Scott determined the possible reserves net to Emerald after applying the terms of the production sharing contract is 19.4 million bbl of oil having a net present value, discounted at 10%, of $452 million. Emerald holds a 50% interest in Block 26 in its 100% subsidiary SNG Overseas Ltd.
2. Norway's DNO tested 5,000 b/d of oil on flow restricted by the test equipment at its Tawke-1 well in Iraqi Kurdestan in northern Iraq. The company reported good-quality sands. It tested six zones and confired oil in four of those zones. The company estimated reserves in the discovery at up to 100 million bbl of oil. A release said the well recovered oil in two deeper intervals but it had not included those zones in its estimates.
3. Kuwait discovered 5 Tcf of gas to raise the country's total gas reserves to 40 Tcf, according to a Xinhua News Agency report from Kuwait's Arab Times newspaper. According to Khalid Al-Sumaiti, deputy managing director of Kuwait Oil Co., the company will spend billions of dollars to develop the new field in the western district of the country. He said initial output from the field should reach 180 Mcf/d of gas by the end of next year. The company found an estimated 35 Tcf of gas in March during an exploration campaign in the northern part of the country.
4. J Ray McDermott confirmed a contract to build two remote unmanned wellhead platforms and pipelines as part of the second phase of the Al Khaleej Gas project in Qatar. The US contractor estimates the value of the work at about US $300 million. J Ray will provide engineering, procurement, construction and installation services for the two platforms, WH10 and WH11 , on jackets previously awarded to the company under phase one of the development. The platforms will be operated from the existing RasGas Alpha complex. The company will also perform EPCI of two intra-field pipelines that will connect the platforms with two 38-in. wet-gas export trunk-lines. Construction work will be carried out from May 2007 at J Ray's Jebel Ali yard in Dubai, with installation scheduled for completion in 2009. "With the award of the AKG Phase 2 project, our Middle East backlog continues to grow," said Hafez Aghili, senior vice president and general manager, Middle East and India. "With increasing opportunities in Qatar's oil and gas market, future prospects are bright. We expect expansion in our regional operations this year, and are improving our production capacity to help meet industry demand."
5. Saudi Arabia and the United Arab Emirates clashed over a US $3.5 billion pipeline project in the Persian Gulf that threatens to bring to a head a 30-year-old border dispute, with Occidental of the US and Total of France caught in the crossfire. The Dolphin subsea pipeline from Qatar to the UAE crosses Saudi territory and "cannot be constructed without the agreement of the kingdom," according to the Saudi government in a communication to the National Bank of Abu Dhabi, which is involved in financing the development. However, the UAE-controlled venture in a statement said the natural gas line is almost complete and runs "exclusively" through Qatari and Emirati waters. The pipeline venture is 51% owned by Abu Dhabi's government and 24.5% each by Occidental Petroleum and Total. The UAE plans to import 3.2 Bcf/d of natural gas through the pipe, almost a fourth of domestic demand that may quadruple to 13.5 Bcf/d over the next 25 years.
6. Oman signed seven E&P Sharing Agreements (EPSAs) worth around US $340 million with various international companies for five blocks in the south and two in the north. Dr Mohammed bin Hamad bin Saif Al Romhi, minister of oil and gas signed the agreements for concessions 54, 55, 56, 57 and 58 in the south and 43A and 43B in the north. Nearly 40 companies took part in the bidding process for the blocks. The consortia of successful bidders were lead by Indago, MOL, Oxy, Al Zakwani, Oilex, PTTEP and Taqah. Indago clinched concession 43A ( Al Buraimi ) in the Al Dahira region, covering 1,128 sq miles (2,923 sq km) while MOL clinched 43B ( Al Batinah ) covering 6,148 sq miles (15,923 sq km). The Occidental consortium, also consisting of Liwa Energy and Mitsui, won concession 54 ( Al Wusta ) covering 2,174 sq miles (5,632sq km), while the Al Zakwani consortium, also consisting of Everson and Dar Al Hidada, won Concession 55 (Al Wusta) which covers 2,920 sq miles (7,564sq km). The Oilex consortium also consisting of Videocon Industries, Gas Authority of India Limited, Hindustan Petroleum Corp. Ltd and Bharat Petroleum Corp. Ltd, was awarded concession 56 (Al Wusta) covering 2,242 sq miles (5,808sq km), while Taqa won concession 57 ( Dhofar ) covering 873 sq miles (2,262 sq km) and PTTEP clinched concession 58 (Dhofar) which covers 879 sq miles (2,277 sq km). All the consortiums are expected to carry out seismic and reinterpretation work over the remainder of this year and into 2007, before drilling wells in 2007/8.
7. Indago Petroleum is to start an aggressive exploration campaign onshore Oman, where it has identified a number of promising gas prospects. The UK independent's chief executive Peter Sadler said the 3-well program would start on Blocks 47 and 31 and take up to 11 months to complete. The company plans to spend about $40 million to drill the wells. The first, Hawamel , will target the Izz prospect in Block 47 near Nizwa in central Oman and will drill to a total depth of 7,218 ft (2,200 m). The second well, Zad , will reach a total depth of 13,780 ft (4,200 m) targeting the Adam prospect. The Izz prospect has the potential to hold 367 Bcf of gas and 2 million bbl of condensate and petroleum liquids, while Adam is estimated to have potential gas reserves of 655 Bcf and 35 million bbl of condensate. In neighbouring Block 31 the company will drill the Al Jariya well on the Jebel Haift prospect to a total depth of 18,045 ft (5,500 m). The acreage borders the United Arab Emirates and has a gas reserves potential of more than 3 Tcf and 500 million bbl of condensate and petroleum liquids. The company currently has a 100% stake in both blocks.
8. Saudi Aramco made a gas discovery in its Eastern Province, reporting that its Zamlah-1 well flowed at around 714 MMcf/d (20 MMcm/d). Oil Minister Ali al-Naimi reported the well was tested on 29 June, with gas flowing at an average of 714 MMcf/d (20 MMcm/d), with 1,400 b/d of associated condensates, according to state news agency SPA . The well, drilled by Aramco, is located 31 miles (50 km) south of the huge Ghawar field.
9. Royal Dutch Shell began drilling its first well in Saudi Arabia, where the company is searching for natural gas in the Empty Quarter desert. Drilling the well may take as long as 3 months, after which the venture will drill two more holes. Shell is leading the venture, with a 40% stake, to explore and develop natural gas resources. France's Total and state-owned Saudi Aramco each hold 30% of the venture, known as the South Rub al-Khali Co. Drilling the well, 43 miles (70 km) from the Yemeni border, was delayed 2 months because of a shortage of transportation vehicles and rig crew.
10. Calvalley Petroleum encountered about 33 ft (10 m) of potential oil pay in a well targeting an objective about 984 ft (300 m) above its existing production reservoir in Yemen's Hiswah Saar-Naifa formation. The company said the well would be completed and tested for production. Calvalley added it had also completed a vertical appraisal well testing the eastern boundary of the Hiswah field. The well encountered more than 328 ft (100 m) of potential hydrocarbon pay. The lower part of the well has been cemented and a horizontal segment will be drilled to convert the bore into a horizontal production well. The company said it was proceeding with further seismic exploration in Yemen, while construction of a central processing facility was going ahead and was expected to be complete by the end of the year. It said a tentative agreement had been reached with Yemeni authorities to build a pipeline linking its Block 9 production assets to the processing facility at Safer.
11. Australia's Oil Search has recorded elevated mud log gas readings and oil shows at its Nabrajah 11 well onshore Yemen. The company said it is planning to proceed with further logging and sampling of its readings before deepening the well or running a testing program on the well, which lies to the west of production well Nabrajah 5 . Nabrajah 5 came onstream last year and is ramping up toward full production rates of 50,000 b/d of oil, which it is expected to hit during the fourth quarter. The field, in which Oil Search holds a 28% stake, is operated by Norway's DNO, with 57%. The Yemen Co. holds the remaining 15%.
12. Canada's Transglobe boosted its capital spending to $54 million from $45 million to run 236 sq miles (610 sq km of 3-D seismic in Block S-1 in Yemen and expand capacity on its central production facility in the area to raise capacity to 15,000 b/d from 11,500 b/d with the help of additional gas injection. Part of the money will pay for an early production system on Block 32 for the Godah discovery, which will start producing between 2,000 and 4,000 b/d of oil in the fourth quarter this year.
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