Dana Gas, known by being one of the most active companies in Egypt, celebrated the new year of 2010 with the successful achievement of its 2009 production target in excess of 40 thousand boepd

Throughout 2009, Dana Gas Egypt delivered an average production rate of 34,750 barrels of oil equivalent per day (boepd), which represented a 27% increase at the end of year production compared to 2008. The average daily production of the UAE Company increased by approximately 20%.
The continuous series of outstanding records hit by of Dana Gas have placed the company as the sixth highest natural gas producer in Egypt. Egypt drilling campaign, which started in 2008. This campaign has already yielded very positive results for us and we will continue with our exploration campaign, we will develop our discoveries, all aimed at growing Dana Gas production operations in Egypt”.

Dr. Hany El-Sharkawi, President of Dana Gas Egypt, believes that this year will be “a busy year” for the company. “We have had a number of significant discoveries in Egypt in 2008 and 2009. It is clear that 2010 will also be a very busy year for us, as we develop all these discoveries and continue with our exploration-drilling program in the Nile Delta and Upper Egypt. We look forward with confidence, building on the success to date,” he told Egypt Oil & Gas Newspaper (EOG).

EOG: What were Dana Gas major discoveries and achievements during 2009?
HE: Last year witnessed a total of nine discoveries; eight of which are gas and one oil discovery. The gas discoveries in the country announced throughout 2009 are Salma-1, West Manzala-2, Azhar-1, Tulip-1, Sharabas-1, Sama-1, Faraskur-1 and Marzouk-2. While, the ninth oil discovery is from the Orchid-1 well. This series of achievements led to a 20% production increase compared to 2008.
Moreover, Dana Gas succeeded to keep its safety records significantly below industry average.

EOG: What were the results of your latest 2009 discovery the Orchid-1?
HE: The Orchid-1 well was drilled in the West Manzala concession of the Nile Delta, 1.3 kilometres to the west of the Azhar1 well, and encountered 8.4 meters of net pay of excellent sand reservoir of Kafr El Sheikh formation, and tested dry gas at a rate of 12.6 million standard cubic feet of gas per day. Dana Gas is currently studying the options for producing Orchid-1 discovery through either its El Wastani or South El Manzala gas plants. The preliminary estimated recoverable reserves of the Orchid discovery range between 10-50 billion cubic feet (bcf) of dry gas, pending further appraisal.

EOG: What is your production target for 2010?
HE: We are seeking another production increase of at least 20% by the end of 2010.

EOG: How much investment are you planning to spend this year?
HE: Our investment budget this year will be higher than 2009 and 2008.

EOG: In a press conference headed by Eng. Sameh Fahmy, Ministry of Petroleum, it was said that Dana Gas is to construct a refinery unit near El-Baraka Field. Can you give us more information?
HE: A third party has presented a proposal to construct a small oil refinery near Al Baraka field and it is estimated that it will be completed by the end of 2010.

EOG: What is Dana Gas E&P agenda for 2010?
HE: We will continue our exploration-drilling program and develop the gas reserves discovered in 2009 to bring on stream by year-end.

EOG: Have your revenues been affected by the global economic crisis?
HE: Definitely, we were affected to some extent, but not significantly due to the liquid component that represents a small portion of our production.

Dana Gas Egypt inaugurated the series of 2010 discoveries by oil hit in Komombo Concession, where oil flew to naturally to surface for the first time in this concession. The Al Baraka-4 well, drilled as an appraisal of the Al Baraka Field in southern Egypt, discovered a new pool in the Six Hills “E” reservoir. The well is currently on-stream producing at a rate more than five times the sustained flow rate from any previous well in the field. It encountered 16 meters of net oil pay in the previously defined reservoirs in addition to eight meters in the new Six Hills “E” layer. The new reservoir is proving to be more productive than the currently producing zones, having tested oil with natural flow to surface at a rate of 220 bopd. It is the first well on the Concession to flow oil to the surface through the natural energy of the reservoir, without requiring artificial lift. The volume of reserves discovered is under evaluation. 

“Al Baraka-4 expands a new era of petroleum exploration in Southern Egypt. The fact that oil has flowed naturally to surface from a new layer with better reservoir quality demonstrates that the Komombo basin is more prolific than originally thought,” commented El-Sharkawi on the discovery.

By Yomna Bassiouni