East West Petroleum provided a 2011 drilling and operations update for the Burg El Arab concession (BEA), located in the Western Desert of Egypt.
Gross production from BEA is approx. 500 barrels of oil per day (bopd) and the 2011 work program is designed to delineate the reservoirs and to treble production to 1400 bopd during the year. Gaffeny Cline, an independent engineering firm, has been retained to complete a NI 51-101 compliant report for the BEA field. A final report is expected early next month.
Operationally three development wells, BEA 8, 9 and 10 are planned to commence drilling in May, to develop oil accumulations in the Abu Roash G dolomite formation and the deeper Bahariya clastics section. The development wells will also evaluate the deeper Al Amaine dolomite formation where oil has previously been encountered. There will also be a six-well workover program during 2011 to increase and accelerate field production. In addition one exploration well will be drilled during the second half of 2011 to test a separate fault block in the 72 sq km BEA development lease.
The total capital expenditure program for 2011 is $26.1 million, ($5.2 million net to East West). This includes the above well program and the construction of 4″ field production pipelines, a 6″ shipping pipeline from the BEA facilities to the Western Desert Petroleum Company crude collection station and construction of a storage tank at the Al Hamra port.
Kuwait Energy, East West Petroleum partner, have informed them that operations in Egypt have not been affected and there has been no impact on production from BEA; though there have been some operational delays in moving drilling equipment to the site.
East West Petroleum and its partners are evaluating the feasibility of co-producing the Al Amaine where oil bearing with the Abu Roash G and Barhariya clastics in the BEA field. Well testing in the new development and exploration wells will enable evaluation of the impact on production of fracing the vertical wells and drilling horizontal wells in tighter zones. Other operators in the western desert have significantly improved production rates and reservoir recovery factors through reservoir fracturing programs.