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Gulfsands Petroleum intersects new oil column at Khurbet East, KHE-13 well production in line

Progress continues at Khurbet East in Syria as the KHE-14 delineation well intersects an oil column and KHE-13 comes on stream, producing in line with expectations.

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Gulfsands Petroleum (AIM: GPX) said its Khurbet East (KHE)-14 delineation well at its Block 26 in Syria intersected an oil column and flowed at 613 barrels of oil per day, indicating a deeper field oil-down-to (ODT) depth.

The KHE-14 well is located 1 km (kilometre) north of delineation well KHE-12 and 4.9 km south of the KHE-1 discovery well has so far been drilled to a depth of 2045 metres with an objective of intersecting the oil-water contact in the Khurbet East field. Preliminary interpretation of drilling data from the top of the Cretaceous Massive Formation and wireline logs identified a gross oil column with a net oil pay of 6 metres and average porosity within the pay zone of 22%.

Wireline logs also indicated that oil was produced from 9 metres deeper than the previous deepest oil flow observed in the field in well KHE-13, leading to the interpretation of a new field ODT at 1,580 metres.

The deeper ODT is expected to have a positive impact on reserve assessments, which are currently being undertaken on the Khurbet East field and are expected to be announced at the beginning of the Q2 2010.

In other news, the KHE-13 well is now on stream, currently producing at approximately 310 bopd (barrels of oil per day), which is in line with expectations and consistent with its location within the field, being superior to that observed from wells drilled in the southern flank. The company will consider undertaking production enhancement measures at the well via installation of permanent artificial lift equipment.

Meanwhile, Gulfsands’ first well in the 2010 exploration programme, Zaman-1, was spudded on 15 January, targeting the same Cretaceous Massive formation under production at the Khurbet East field. Gross unrisked speculative reserves for this prospect are estimated to be in the range of 23 to 35 million barrels of oil. Drilling operations on the Zaman-1 well are anticipated to take 45 days.

“The positive and significant results from  KHE-14 delineation well in addition to  the  start  of oil production  from KHE-13 both represent very significant milestones  in the continuing development of the  Khurbet East Field from both a production and potential reserves perspective.  With the spudding of the Zaman-1 exploration well, the company now commences an active and potentially exciting exploration drilling programme of four wells during 2010,” said chief executive of Gulfsands, Ric Malcolm.

The company reported gross cumulative oil production of 5 million barrels from Khurbet East in October.

Gulfsands holds a 50 percent working interest and operates the Block 26 in North East Syria, which covers 8,250 square kilometres and encompasses existing fields, which currently produce 100,000 bopd.  Emerald Energy PLC (LSE: EEN) - which is being taken over by Chinese state-run oil company Sinochem - holds the remaining 50%.

Proven and probable reserves attributable to Gulfsands at 31 December 2008 were 28.7 million barrels of oil working interest and 10.9 mmbbl entitlement.

Quick facts: Gulfsands Petroleum plc

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