Dana Excels in E&P, Plans 17 Wells for Rest of 2008
Dana Petroleum has excelled with its exploration program so far this year. Four wells have been drilled in the period, namely the significant oil discoveries at West Rinnes and East Rinnes in the UK Northern North Sea, the sub-commercial oil discovery at Morgan in the UK Central North Sea and a dry well at Bjorn in Norway.
West Rinnes and East Rinnes proved good quality Brent reservoir sands, excellent quality oil and high flow rates of 7,800 barrels per day. These discoveries are located just 5 kilometers from the Dana-operated Hudson producing oil field and 2.5 kilometers from the company's Melville oil field. The company is now considering further exploration potential in the area and the optimal development of the Rinnes discoveries, which are now the third and fourth oil fields under Dana's operatorship in this prolific area of the Northern North Sea.
Additionally, Dana is currently drilling two wells offshore Egypt, at West El Burullus in the Nile Delta (Dana 50%), and at West Gihan in the Gulf of Suez (Dana 20%).
Dana was also awarded seven blocks across three licenses in Norway in January 2008. The partnership group has already secured a rig and committed to the drilling of the large Trolla prospect (Dana 30%) on license PL.485 in 2009.
The company was pre-qualified as operator on the Norwegian Continental Shelf, allowing the acquisition of seismic on the new operated license PL.464 (Dana 55%) awarded in APA 2007.
A rig has been secured to drill the Tornado oil prospect (Dana 30%) in the UK West of Shetland area in first half of 2009.
Dana achieved an average production from January 1 to April 30, 2008 of approximately 44,650 barrels per day oil equivalent after impact of Forties Pipeline System shutdown.
There remained strong production from Cavendish gas and Enoch oil fields, Dana's most recent developments, which were brought onstream in 2007. Dana saw excellent performance from its Egyptian oil fields, including additional production from the re-instated C1 well on East Zeit and the newly drilled South-West Qarun-12 well. There is now a rig on location at East Zeit oil field, offshore Gulf of Suez, to undertake workover and infill drilling campaign, to be followed by drilling of Dana exploration prospects in Gulf of Suez.
Dana has three development projects sanctioned to deliver future production growth:
1. Grouse oil field (Dana 50%), in Greater Kittiwake Area of UK Central North Sea, with first oil scheduled for early 2009, which will deliver high value incremental production as a tie-back to the Kittiwake platform
2. Babbage gas field (Dana 40%), in UK Southern North Sea with first gas sales anticipated in Q1 2010
3. E18 gas field (Dana 5.228%) in Dutch North Sea is being developed as a tie-back to the F16-E platform, with first production targeted for Q3 2009
Additionally, the Dana-operated Barbara/Phyllis joint gas field development in UK Central North Sea is progressing well. Host platform selection is planned for Q3 2008 with project sanction expected early 2009.
Dana completed acquisitions of 15% interest in offshore Tanger Larache, Morocco, and 20.67% stake in Block 21/20a in the Greater Kittiwake Area of the UK Central North Sea. The company farmed-out a 41% interest in the Monkwell area prior to drilling in Q3 2008, and negotiated a cost-carry through the work program on Block 211/8a in the UK Northern North Sea. Dana also increased shareholding in Faroe Petroleum plc to 27.5% via a series of market purchases. As a result, Dana will equity account for its investment in Faroe Petroleum from 2008.
Group production for 2008 is expected to average between 40,000 and 45,000 barrels per day oil equivalent, representing more than a 30% growth over 2007. Dana has up to 17 exploration wells scheduled in 2008 with rigs for 14 of these already secured. The company has a planned 2008 capital investment program of approximately £200 million across existing fields and licenses.
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