In light of the current low oil price environment, lack of conclusive well results to date and the limited time remaining in the current period of the Production Sharing Contract (PSC) for the Dinarta licence, Hess and Petroceltic have jointly elected to withdraw from the Dinarta licence without any further drilling.

“Petroceltic’s strategy remains clearly focussed on delivering from its core producing and development assets, whilst maintaining balanced exposure to longer term exploration led growth wherever possible,” said Brian O’Cathain, chief executive of Petroceltic. “In light of this, and the current oil price environment, the decision to withdraw from Kurdistan is the right one for the business.”

As previously announced on 15 January, drilling operations on the Shireen-1 exploration well in the Dinarta licence (Hess Middle East New Ventures as operator with 64%, Petroceltic holding 16%, and the Kurdistan Regional Government 20%) encountered significant operational challenges since the resumption of drilling on 2 October 2014.

The well reached a maximum depth of 1,430-metres in Jurassic formations on 26 December 2014 before being suspended while forward options were reviewed by the operator.

This review concluded that an additional well would be required to further evaluate the exploration potential of the Shireen prospect, and that further operational difficulties could not be ruled out.

All PSC work programme obligations have been fulfilled other than the required final remediation of the well sites.

Source: Oil and Gas Technology