Gulfsands Petroleum plc (LON:GPX) reported that spudding the Sidi Dhaher exploration well in Tunisia is likely to be delayed by merely a few weeks, following the recent violent protests in the North African country.
Work was initially expected to start early in February, but ADX Energy (ASX:ADX) - operator of the Chorbane onshore licence - expects there will be some delay primarily due to third party contractors taking additional security precautions and potential delays in customs handling of equipment.
Assuming the recent improvement of the overall security situation continues in Tunisia, ADX anticipates that most contractor services will be fully available in February allowing a potential spud date in late February, Gulfsands said.
Protests started last month over unemployment, high food prices, corruption, freedom of speech and poor living conditions and culminated in President Zine El Abidine Ben Ali stepping down and fleeing Tunisia last week after 23 years in power.
The operator is continuing with road works and site preparations at the Sidi Dhaher well site and the ADX office in Tunis is fully functioning and all services such as communications, public transport and airport services are available without any disturbance.
Additional precautions are being taken during all operations and travel of ADX personnel in Tunisia.
ADX has also been liaising closely with Enterprise Tunisienne d'Activities Petrolieres (ETAP), the government agency responsible for the management of oil and gas activities in Tunisia whose offices have reopened as of yesterday. ETAP is supportive and encouraged by the continuation of well site preparations, which are already at an advanced stage.
The well will drill to a target depth of 2,150 metres, which is likely to take 45 days.
Gulfsands will pay 80 percent of the first US$5 million in drilling costs for the Sidi Dhaher well and 40 percent of spend thereafter to earn a 40 percent working interest in the Chorbane Block.
The total estimated spend on the well is expected to be US$6.9 million, or US$4.8 million net to Gulfsands.
The Sidi Dhaher prospect contains multiple potential reservoirs of Tertiary and Cretaceous age that will be evaluated with this well.
ADX has estimated prospective resources of 175 billion cubic feet of gas in the Eocene aged Metlaoui Formation and 44 million barrels of oil in the Cretaceous aged Abiod Formation.
Additional resource potential exists in the Douleb and Bireno members of the Cretaceous aged Aleg Formation.
As well as Tunisia, Gulfsands has oil and gas assets in Syria, Iraq, Italy and the US.