RAK Acquires Eagle Energy, Increases Interest in West Bukha Field

RAK Petroleum has purchased Eagle Energy (Oman) Limited, a wholly-owned subsidiary of UK-based Heritage Oil Limited, for cash consideration of $28 million. Eagle Energy holds a 10 percent interest in Block 8, Sultanate of Oman. The acquisition brings RAK Petroleum's total shareholding in the block, which the company operates, to 50 percent.

RAK Petroleum announced in February 2009 that first production from Block 8's West Bukha field located offshore in the Strait of Hormuz had commenced with initial capacity of 10,000 barrels per day of 42 degree API gravity oil and 30 million cubic feet per day of associated gas from two wells through a six-slot unmanned platform located in 90 metres of water some 25 kilometers from the Musandam Peninsula.

"This acquisition increases our exposure to West Bukha's upside potential and also underscores our commitment to investing in the upstream sector in the Sultanate of Oman," stated Abdulaziz Al Ghurair, Chairman of RAK Petroleum's Board of Directors.

West Bukha was first discovered in 1976 but was believed to be a gas condensate field and abandoned as non-commercial. Between 2006 and 2008 drilling by RAK Petroleum of new appraisal wells, including an extended horizontal section, demonstrated significant oil productivity from the Mishriff-Maudud and Thamama reservoirs, leading to the recent completion of field development. The remaining 50 percent interest in Block 8 is held by Korea’s LG International Corporation.

Production is tied through a 12-inch multiphase flow line to the nearby Bukha production platform. The Bukha gas condensate field, also in Block 8, was developed in 1994 and today can flow an additional 10 to 15 million cubic feet per day of non-associated gas. Output from the two fields is transported through a 16-inch, 33-kilometer multiphase flow line to shore for processing at the Khor Khwair plant in the Emirate of Ras Al Khaimah. Oil and condensate are slated for export while gas is delivered to industrial and commercial users in the Emirate.

"RAK Petroleum continues to look for acquisitions to expand its portfolio in the Middle East and North Africa and the opportunity to buy a further 10 percent in Block 8 consolidates our position in an area very well known to us," stated Bijan Mossavar-Rahmani, RAK Petroleum's Managing Director and Chairman of the Executive Committee of its Board of Directors.