Centurion Energy, the Toronto (symbol: CUX) and London AIM (symbol: CUX.L) listed independent oil and gas exploration and production company, operating principally in the Egyptian Nile Delta, today announces an update on its activities.
El Wastani 9 located in the El Wastani Development Lease tested at a combined rate of 30 mmscfpd from two zones, Lower Abu Madi and Qawasim with a combined perforated interval of 16 meters. Testing of additional 20 meters of net pay in the Lower Abu Madi is ongoing. The well which is located approximately 6 kilometers south of El Wastani #1 will be completed initially as a Qawasim producer.
Abu Monkar 2 located in the South El Manzala Development Lease is currently in the midst of testing. Although mechanical problems have delayed testing of the well, mud logs indicate the presence of natural gas and liquids in a 15 meter section in the Sidi Salim formation at a depth of approximately 2,500 meters.
El Wastani 6 located in the El Wastani Development Lease has reached the intermediate casing depth at 2,500 meters. After running 9 5/8 inch casing, drilling will continue to a total depth of 3,100 meters targeting Abu Madi and Qawasim reservoirs.
West Gharib drilling results released by Operator, Tanganyika Oil Company Ltd. indicates three potential oil producers with Hoshia 1 testing 500 bopd of 16.5 degree API oil. Test results from Fadl 1 and West Hoshia 1 are pending.
Current production in Egypt continues at a rate over 20,000 boepd consisting of 103.5 mmscfpd of gas and 2,300 bpd of associated liquids from the Nile Delta development leases and 550 bopd from the Hana Field.
the first Mellita exploration well on Djerba Island is expected to spud in May.
Commenting, Said Arrata, President and CEO, said:
"I am very pleased to report continued drilling success in our Egyptian operations both in the Nile Delta company-operated gas project and also in our non-operated 30% interest in the West Gharib exploration wells. The indication of the potential of gas and liquids in the Abu Monkar 2 well is particularly significant because if successful, it will be the first well in the South El Manzala development lease to produce rich gas and also the first discovery in our Nile Delta development in the Sidi Salim Formation."
The El Wastani 9 well located in the El Wastani Development Lease reached total depth of 2,936 meters on March 6, 2005. The well encountered a productive zone in the Qawasim formation where a ten meter section was perforated and tested at 9.0 mmscfpd of gas plus 190 bpd of associated liquids. Three productive intervals in the Lower Abu Madi Formation totaling 26 meters of net pay within a gross interval of 50 meters were encountered. A perforated interval of 6 meters was tested at a rate of 21 mmscfpd plus 374 bbl of associated liquids. Testing of additional 20 meters of net pay in the Lower Abu Madi is ongoing. The well will be completed initially as the first Qawasim producer in the El Wastani Development Lease and will be tied into our existing infrastructure.
The Abu Monkar 2 well located in the South El Manzala development lease has reached total depth in the Sidi Salim formation at 2,510 meters. The well has experienced some delays because of difficult shale formations and mechanical problems. Mud logs indicated gas in a section of approximately 15 meters. During drilling a significant gas kick was experienced with 200 psi at surface while pulling out of the hole. Production casing has been run and we are currently preparing to test the well. The El Wastani 6 well spudded on March 22 and has reached intermediate casing depth at 2,500 meters. The well is targeted for a total depth of 3,100 meters in the Sidi Salim Formation.
The operator of the West Gharib Concession (Centurion 30% Working Interest) has announced a drilling update on exploration wells drilled on the concession. They announced that the Hoshia 1 well flowed with a beam pump approximately 500 barrels per day of 16.5 degree API oil from a 28 foot perforated zone between 4,035 and 4,068 feet. The well penetrated 32 feet of oil pay in the Lower Miocene Rudeis sandstone reservoir with average 25% porosity.
The operator has also completed drilling the shallow well West Hoshia 1 located 4 kilometers south west of Hoshia 1 to a total depth of 2,028 feet. Petrophysical logs and 15 feet of 8 1/2 inch core indicate 60 feet of potential heavy oil pay with average 17% porosity. Testing operations will commence as soon as testing equipment is available. Fadl 1 is suspended after completion of a cement squeeze to isolate a water zone below an indicated 40 foot potentially productive heavy oil zone as indicated by petrophysical logs. The operator is currently drilling its forth consecutive exploration well in the 2005 program, Naiem 1, which is located 6 kilometers south of the Hana field.
Drilling Rig Update
ECDC Rig 2 contracted to Centurion for one year with two 6 month options will be released to another operator under a previous commitment for one well and will be returned to Centurion on or about the end of June.
SBDC Rig 50 contracted to the end of 2005 with two 6 month options continues to drill for Centurion.
ECDC Rig 6, subject to final bid committee approval will be contracted for a 1 year period with two 6 month options and will be available in late July.
A Precision Rig currently located in the Middle East region, subject to final bid committee approval and negotiation of acceptable mobilization costs will be contracted for 1 year with two 6 month options and will be available in August.
SBDC Rig 650, a completion rig, is available full time to Centurion.
It is Centurion's intention to have 4 rigs contracted by August to accelerate our drilling program on the two Nile Delta development leases as well as commencing drilling operations on the two new exploration concessions, West Manzala and West Qantara.
West Manzala and West Qantara Exploration Concessions
Centurion has a 2,000 square kilometer 3D seismic
acquisition program underway on the West Manzala and West Qantara exploration concessions. On the West Manzala concession, approximately 250 out of 1,400 square kilometers (18%) has been acquired. Data quality so far has been excellent and processing in Calgary will commence soon. Upon completion of the acquisition of the West Manzala program the crews will commence a 600 square kilometer program in the West Qantara concession. Centurion plans to process acquired data concurrently with the continued acquisition of data to accelerate the exploration process.
Block 2 Komombo
Reprocessing of 1,500 kilometers of 2D seismic data is ongoing. State of the Art processing techniques are being applied to confirm the geological prospects. In addition, surface geological work was awarded and a tender for a 2D seismic acquisition program was issued.
Facility Construction and Upgrades Update
The El Wastani Phase 2 Facility Expansion allowing increase of capacity to 140 mmscfpd is expected to be operational by mid Q3. Further expansion will allow capacity to increase to 160 mmscfpd by November 2005. Liquids will continue to be processed through the Abu Madi plant under reduced tariffs until the company-owned refrigeration facility is operational in 2006.
South El Manzala
The SEM Phase 2 plant and pipeline expansion should be operational by mid Q3 as well bringing capacity from the South El Manzala concession up to 120 mmscfpd.
Centurion is positioned to meet its year end target of 250 mmscfpd of gas production plus associated liquids.
Sale of Tunisian Producing Properties
The sale of properties in Tunisia as previously announced is still expected to close by the end of April, 2005 for proceeds of $41 million plus working capital adjustments. Centurion retained the right to participate for up to 50% of its previous working interest in any wells drilled for Triassic targets on either the Ezzaouia or El Biban concessions.
As previously announced, the Mellita Concession was excluded from the sale of Tunisian assets. PetroCanada have advised Centurion that they expect to spud the first exploration well under their earning commitments on shore on Djerba Island in May, as soon as the contracted rig is released from the well it is currently drilling.