The well is the second of two option wells drilled under the Company's farm-in on PetroHungaria kft of Budapest. DualEx has now completed earning its 37.5% working interest in over 600,000 acres within the Nyirseg North and South Exploration Permits, which include the petroleum and natural gas rights at two recompletion candidates in the Peneszlek area, PEN-9 and PEN-12, which successfully tested gas from the Miocene, but were never tied-in. Each of these wells currently stands suspended. All operations on the Nyirseg Blocks will now be funded on a straight-up basis, with DualEx paying 37.5%.
Garry Hides, DualEx CEO, commented: "Although we obviously would like to have made a commercial gas discovery, the fact that we had good gas shows in the Miocene is encouraging, and will play an important role in how we plan the exploration effort in this area going forward. Additionally, and importantly, this well completes our earning obligations under the farm-in agreement, which allows us to move forward with our partners in the development of the already discovered gas in the Peneszlek area, along with further assessment of the exploration potential of the blocks."
The partners are planning a development centered on the PEN-104 gas discovery (announced November 2006) and incorporating the PEN-9 and PEN-12 discovery wells. The re-development of the previously productive Peneszlek field will be considered as an addition to this development. PetroHungaria (the operator) is proceeding with these various development initiatives at Peneszlek, which include pipeline integrity testing on the existing gathering system; the necessary wellbore permitting and regulatory approvals for the re-entry of PEN-9 and PEN-12; and the negotiation of natural gas processing and transportation arrangements with the operator of the area infrastructure.
The Company's PEN-104 discovery, together with PEN-9 and PEN-12, cumulatively tested over 7.5 MMcf/day of gas from both the basal Miocene volcaniclastic section and the overlying Pannonian section. DualEx and its partners aim to have natural gas production on stream at Peneszlek this coming winter.
In Syria, good progress continues to be made in the field acquisition of the 1138 km 2D seismic program on Block 17 in the Palmyra region (DualEx 31.67% working interest). Field recording commenced in mid-March 2007, and is approximately 76% complete. In addition, DualEx and its partners have undertaken the reprocessing and interpretation of a total of 2,338 line kilometers of legacy 2D seismic data. The results of the new seismic acquisition and the reprocessed legacy data, once integrated with the geologic/petrophysical review and existing well data, will be used to rank prospects for drilling in 2008. On Block 17, DualEx and its partners are targeting hydrocarbons in the Triassic Kurrachine formation, in which significant discoveries have been made by other operators on adjacent blocks.
DualEx Energy International Inc. is an oil and gas exploration company with operations in the greater Mediterranean area.
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