United Oil & Gas announced average H1 2021 production net to the company’s working interest of 2,730 boepd from the joint venture Abu Sennan licence in Egypt.
WATER–CUT
The company holds a 22% working interest in the licence comprised of seven producing oil fields operated by Kuwait Energy Egypt.
The ASH field currently has three wells producing more than 3 million barrels gross, representing some 60% of oil production on the licence since the start of 2020.
The production figures released today are slightly higher than full-year guidance of 2,500 to 2,700 boepd although the company also reported an increase in water-cut.
Since early July, the water-cut had increased on all three producing wells, particularly on ASH-2, where it had increased at a faster rate than expected.
REVISED GUIDANCE
As at 4 September, production from the Abu Sennan licence was 1,817 boepd net to the company’s working interest.
As a result of the lower oil production from the ASH field, the company has revised its full-year guidance for the Abu Sennan licence from 2,500-2,700 to 2,100-2,300 boepd.
“The increase in water cut has been accompanied by an associated drop in production from the ASH field.
“The joint venture partners are still in the early days of monitoring the performance of the wells since the interventions were performed and are continuing to consider other options that could help stabilise the decline.”
The company said that the other six fields on the Abu Sennan licence were unaffected and producing in line with expectations.
SOLUTION
Chief executive Brian Larkin added that the Abu Sennan licence had performed exceptionally since its acquisition.
“Whilst the increase in water cut at ASH-2 and the resulting impact on our production guidance is disappointing, we will continue to work with the JV partners to identify and implement the best long-term solution.
“The continued investment in the Abu Sennan licence by the JV partners speaks to the potential which exists within the concession and we look forward to updating shareholders as we receive further results.”
DRILL PROGRAMME
Drilling is progressing on the ASX-1X exploration well, located near ASD-1X, where the JV partners expect to reach primary reservoir targets within the next two weeks.
They also anticipate that a further development well will be added to the 2021 drilling programme.