Sea Dragon Energy Inc. is pleased to provide the following update on its Operations in Egypt.
NW Gemsa Concession
Al Amir SE #7 Well
The Al Amir SE #7 well was spud on November 27th and is currently drilling below 8,500 feet towards a targeted total depth of 16,750 feet. The primary target for this well is the Kareem Formation and the secondary target is the Lower Rudeis Formation where gas and condensates were tested in the adjacent Al Amir SE #6 well. The well is expected to delineate the western limits of the Al Amir SE field and is anticipated to be completed as a water injection well in preparation for commencing water injection in the field. Water flooding of the Al Amir field is expected to provide significant reserve and production additions in 2011.
The Al Ola X-1 well was placed on production at 1400 bopd from the Kareem Rahmi Formation. Although the Al Amir SE and Geyad fields are capable of producing at significantly higher rates, total production is still restricted to 8500-9000 bopd in order to minimize gas flaring, pending the implementation of gas conservation and water flooding operations.
Cumulative production from the concession has now exceeded 4 mmbbls. of 42 degree API crude oil.
Sea Dragon has a 10% working in the NW Gemsa Concession with Vegas Oil at 50% as operator and Circle Oil Plc with 40%.
Kom Ombo Concession
Al Baraka #13 Well
The well was spud on December 12th and is currently drilling below 4,200 feet towards its targeted depth of 5,000 feet in the Six Hill “E” Formation. The well is expected to be completed and if successful placed on production prior to year end.
Al Baraka #11 Well
The well was spud on November, 22nd and drilled to its total depth of 5,299 feet in the Six Hills Formation. Open hole logs were run and analyzed. The primary objective being the Six Hills “E” Formation was successfully encountered. Casing was run and the drilling rig was released on December 6th. The well is currently being completed in the Six Hills ”E” sands and will be placed on production prior to year end.
Al Baraka #12 Well
The well was completed in the Six Hills “E” Formation in the interval 4,522-4,530 feet and placed on production at 190 bopd.
Al Baraka SE Well
This step out well was drilled to its total depth of 8,750 feet in the Kom Ombo Formation. Petrophysical analysis of the open hole logs indicates 46 feet of potential oil pay in the Kom Ombo Formations. The Kom Ombo sands were completed with 34 feet of perforations and clean oil recovered at surface. The well will be placed on production shortly. The recovery of oil from the Kom Ombo sands is very encouraging as it could potentially result in additional development drilling and production from this southeastern extension of the Al Baraka Field.
Remaining in the work program prior to year end is the placement of the Al Baraka #5, #11 and Al Baraka SE on production, the frac. treatments of two development wells and the spud of the Memphis exploratory well.
Sea Dragon has a 50% working interest and is a joint operator of the Kom Ombo Concession with Dana Gas Egypt owning the remaining 50%.
Commenting on the latest developments on the Company’s operations in Egypt, Company Chairman and CEO Mr. Said Arrata stated “All efforts are now being deployed to maximize production from the Al Baraka field in order that we may achieve our target rate of 2000 bopd by the end of December or shortly thereafter. The spud of the Memphis prospect marks the beginning of our endeavours to test the vast upside potential of the Kom Ombo Block. I am very pleased by the progress our company made during 2010 in both of our concessions in Egypt and look forward to continued growth in our production, reserves and cash flow both in Kom Ombo and NW Gemsa”.