DNO is reporting final results from the testing of Yaalen-3, in the Republic of Yemen. The second test in Yaalen-3 flowed 2,650 barrels of oil per day (bopd). As the first test flowed 1.400 bopd, the aggregated flow rate from the two tests is 4,050 bopd. The test rate from both tests intervals were restricted by the capacity of the down hole electrical pump used during the test, and the Company expects that the aggregated flow capacity of the well is in the order of 10,000 bopd.
As previously reported, the Yaalen-3 appraisal well in Block 47 encountered two oil bearing intervals in the Qishn sandstones, of a total combined net thickness of around 20 meters ("net pay"). Two tests have been undertaken in the well, one in each of the oil bearing intervals.
The first test was undertaken in the lowermost interval. This interval flowed around 1,400 bopd, with no water. The second test, which was undertaken in the uppermost interval flowed 2,650 bopd. The flow rates were restricted by the electrical down hole pump used during the tests. Based on the flow and pressure data observed during the two tests, it is anticipated that the initial aggregated flow capacity of this well is in the order of 10,000 bopd. No formation water was observed during the test, and the well proved the thickness of the reservoir to be larger than expected.
The gross combined reserve potential of the Yaalen / Sharnah oil discoveries was estimated at 10 million barrels prior to the drilling of the Yalen-3 well. Work will now be undertaken to incorporate the Yaalen-3 results into the geological model. Based on the observations to date, it is expected that the reserve potential of the Yaalen structure will increase, hence the reserves basis for the Yaalen / Sharnah field development project is expected to improve.
Drilling of the Yaalen-3 appraisal well was part of the work program in preparation for a development of the Yaalen and Sharnah oil discoveries in the block. With the positive results observed in Yaalen-3, DNO intends to accelerate the development of this area, with possible first oil production in the third quarter of 2011. DNO holds a 40 % interest in block 47.