Dover Petroleum Begins Drilling on EWA-3X Target

Dover Petroleum reports that the offshore re-drilling on the target EWA-3X will begin this week, weather permitting.

The EWA-3X is the step out well being drilled adjacent to the EWA-2X that was drilled in December 2002. In February 2003, Schlumberger Limited, a leading oilfield services company, performed further evaluation of the electric logs over the significant oil zones detected in EWA-2X. The aim of this additional work was to derive a better understanding of the potential of the two carbonate reservoirs to ultimately produce economic oil or not and to plan a step-out well, the EWA-3X, to confirm the significant oil indications observed in the EWA-2X well within the Kareem and Thebes dolomitic limestone reservoirs. In addition, the EWA-3X will be deepened to test the lower Matullah and Nubia sandstone reservoirs, which are very important producers in the Gulf of Suez and were a primary target untested in the first EWA-2X well.

In May 2003 Schlumberger Limited completed an additional, and more extensive, independent Well Evaluation Report of the drilling at the well target EWA-2X. Schlumberger concluded that the EWA-2X has significant quantities of crude oil in place in the order of 220 million barrels of oil or greater.

Further studies undertaken by the Egyptian Petroleum Research Institute (EPRI), an independent technical lab, of 6 ditch samples taken from the EWA-2X well were evaluated for prediction of the API (American Petroleum Institute) gravity with the following results:

  • Sample No. 1, depth of 1700-1710ft contained migrated light oils with an API gravity range of 35-38 degrees.
  • Samples No. 2 depth 1740-1750ft and sample No. 3, depth 1770-1780ft contained migrated hydrocarbons with API's of 25-29 degrees.
  • Sample No. 4, depth 1810-1820ft., contained migrated heavy oil with a small contribution of generation hydrocarbons, API 17-19 degrees.
  • Samples No. 5 and No. 6, depth intervals 2890-2900ft and 3030-3040ft, respectively contained migrated heavy oil with high contribution of hydrocarbons generated in situ with API's of 22-25 degrees and 20-22 degrees, respectively.

  • The API gravity predictions indicate a strong potential for the crude oils to be moveable, with all API ranges indicating the presence of commercial grade crude oils at all depths tested. To illustrate the possible practical significance of these findings, at current prices crude oil with an API of 35 sells for approximately $24 per barrel. Crude with an API of 18 will sell for about 20% less.

    Dover feels that this oil may prove commercially recoverable if successfully drilled and tested at the EWA-3X target. However, no firm assurances can be provided that EWA-3X contains any moveable crude oil, or if such crude oil exists that it can be recovered in a commercially viable manner. In addition, substantial additional capital will be required in order to bring such oil into production, and no assurance can be provided that such capital will be available to Dover Petroleum.

    Dover Petroleum Corp.'s wholly owned subsidiary, Dover Petroleum Egypt I Inc., has a 56.25% interest in Dover Egypt I Joint Venture, which is a party to an Option Agreement entitling that joint venture to acquire 100% of the Operator's interest in the East Wadi Araba Concession Agreement.

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