RAK Petroleum Public Company Limited, the exploration and production company, today announced temporary suspension of drilling operations on the Saleh-5 well offshore Ras Al Khaimah following consultations with partner RAK Gas LLC which this week exercised its full 30 percent back-in option to the field redevelopment project by agreeing to pay its prorata share of past and forward costs.
Total Saleh-5 drilling costs, including suspension and rig move, are estimated at USD 35 million of which RAK Petroleum’s share is USD 24.5 million. Favourable contract terms allow recovery of all drilling and other capital and operating costs from revenues from the Saleh field or the adjacent RAK B field, also planned for development, before any tax and royalty payments are made to the state.
Following suspension of the Saleh-5 well, the Noble Roy Rhodes rig will be transferred to the nearby RAK Petroleum operated Block 8 offshore Oman, where the Company is committed to drilling three development wells. The Saleh-5 wellbore will be left in a condition that allows re-entry and continuation of operations. The rig is available to return to the Saleh field at end 2012, although a search has been launched for an alternate rig to accelerate the multi-well redevelopment program.
Separately, RAK Petroleum is in discussions with an undisclosed company that has proposed to pay 100 percent of the costs of a first exploration well within the Saleh license to earn partial rights to participate together with RAK Petroleum and RAK Gas in the acreage surrounding but not including the Saleh field itself.
RAK Petroleum has also been notified by the Government of Ras Al Khaimah that the Norwegian company Petrolia ASA through its chairman Berge Gerdt Larsen on 2 November 2011 made a written proposal that the Saleh and RAK B licenses be repurchased from DNO International ASA by RAK Petroleum for a “nominal amount” and offered that Mr. Larsen and other unspecified individuals “are more than willing to support RAK Petroleum’s development of its licenses offshore.”
In response, a RAK Petroleum spokesman indicated that it is neither appropriate nor even possible to withdraw any assets from a merger plan that has been approved by the shareholders of both companies. “Following the completion of the merger, what companies or individuals DNO International chooses to partner up with or allow into the Saleh field or any of the other RAK Petroleum assets is of course a matter for DNO International,” said the spokesman.
The Saleh-5 well was spud on 3 July 2011 as part of a RAK Petroleum multiple well initiative to redevelop the Saleh gas and condensate field. Difficulties and delays have been encountered while drilling through depleted zones in an attempt to reach the Thamama reservoir. Additional technical studies will be conducted before resuming drilling operations. The eventual outcome of the Saleh-5 well does not affect RAK Petroleum’s perception of the value of the field given plans to re-enter, deepen and test other wells.
The Saleh field was first brought on production in the mid-1980s. A total of 106 billion cubic feet of gas and 14 million barrels of condensate have been produced from the Wasia reservoir from seven wells through six existing wellhead platforms. The field has continued to produce small volumes of gas through an 18-inch pipeline to shore. The Thamama reservoir is a proven, producing reservoir in the Saleh field that remains largely untapped.
Source: RAK Petroleum, November 11, 2011
OSLO, Norway – DNO International plans to pick up re-development of the Saleh field 45 km (28 mi) offshore Ras Al Khaimah, after completing a current drilling campaign on the West Bukha/Bukha fields off Oman.
The company has a 70% operated stake in Saleh, following a transfer of interests agreed last year with RAK Petroleum. Production started in 1984 and peaked at 70 MMcf/d of gas and 13,000 b/d of condensate in 1986.
Since then, rates have declined due to pressure depletion and water breakthrough. There are currently five wells and seven small platforms on the field, with some of the wells flowing on an intermittent basis since 1996. Production is sent to the onshore RAK Gas processing facility via an 18-in. (45.7-cm) pipeline.
Following a subsurface study, DNO believes the horizon below the existing depleted reservoir may hold unrealized potential. Although operations had to be suspended on the Saleh-5 well appraising the lower reservoir due to difficult drilling conditions, DNO says it learned much about the drilling of depleted reservoirs, which should be of use as development progresses.
For the re-development, the number of wells required will be based on a new review currently being undertaken DNO’s subsurface and drilling team.
The RAK B field is 28 km (17 mi) southwest of Saleh. The RAK B-1 well, drilled in 1976, discovered oil with good reservoir characteristics at the Ilam level, and condensate-rich gas at the Thamama level. Three appraisal wells were then drilled to delineate the structure.
Studies continue, but DNO expects to drill a further appraisal well in early 2014, followed by a single unmanned platform development tied back to the Saleh facilities.
DNO ASA: DNO Granted Somaliland Extension
Oslo, 8 September 2014 – DNO ASA, the Norwegian oil and gas operator, today announced that it has been granted a two-year extension of the term of its production sharing agreement for Block SL18 in Somaliland. The first exploration period will now end on 8 November 2017.
Block SL18, in which DNO has a 50 percent stake as operator, is a frontier exploration block. The partners have completed field survey and environmental assessment studies over the block and will initiate a planned seismic acquisition program once the Government of Somaliland has put in place a planned Oil Protection Unit (OPU) to support the international oil companies operating in Somaliland. The OPU is expected to be operational in 2015.
In the interim, security conditions permitting, DNO will resume a development program focused on drilling water wells to provide local communities in the areas covered by Block SL18 with potable water.
— DNO ASA is an Oslo-listed, Middle East and North Africa focused oil and gas company holding stakes in 20 blocks in various stages of exploration, development and production both onshore and offshore in the Kurdistan Region of Iraq, the Republic of Yemen, the Sultanate of Oman, the United Arab Emirates, the Tunisian Republic and Somaliland —
Oslo, 8 September 2014
Queries: Bjorn Dale (firstname.lastname@example.org or ph: +47 911 57 197)
This information is subject of the disclosure requirements pursuant to section 5-12 of the Norwegian Securities Trading Act.