Oil sector analysts at Merrill Lynch said that production from the mainly Africa-focused independent oil and gas firm Afren "could materially surprise" in 2013 after it issued an operations update in which it revealed net production for last year was in line with guidance at 42,830 barrels of oil equivalent per day (boepd).
Afren's management has forecast a similar production range of between 40,000 and 47,000 boepd for 2013.
The firm achieved three significant exploration discoveries in 2012, including the Okoro field extension, offshore Nigeria, where the first production well came on-stream at 5,000 barrels of oil per day (bopd) and Simrit-2 in Kurdistan, Iraq, where oil flow has tested at 13,584 bopd.
Afren added that seismic data acquisition and ongoing prospect maturation has upgraded its East Africa exploration prospectivity to 5,838 million boe net to the firm.
Meanwhile, the firm continues its 14-well exploration and appraisal drilling campaign that is targeting net resources of 670 million boe. The Okwok-10 appraisal well in Nigeria, the Simrit-3 exploration well in Kurdistan and the Paipai exploration well in Kenya are currently drilling, it said.
"2012 saw record production and financial performance combined with significant exploration success in Nigeria and the Kurdistan region of Iraq. In 2013 we expect to further grow our reserves base through a multi-well exploration and appraisal drilling campaign in both established and new basins, while continuing to grow our production base," Afren Chief Executive Osman Shahenshah commented in a statement.
Merrill analysts commented Afren's forecast of up to 47,000 boepd for 2013 "excludes any production volumes from the Kurdistan region of Iraq, which offers the potential for material upside surprise".
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