WesternZagros Resources Ltd. has started drilling operations at the Mil Qasim-1 well on the Garmian Block in the Kurdistan Region of Iraq. Mil Qasim-1 is located three kilometers to the southeast of the Company's Sarqala-1 discovery well. Mil Qasim-1 is targeting the prospective Upper Fars interval that exhibited numerous oil shows, including oil to surface in the drilling mud, while drilling the same interval in the Sarqala-1 well. The planned total depth is approximately 2,400 metres.
"This is the first well to be drilled on the Mil Qasim structure, which we believe could potentially be developed jointly with Sarqala," commented Simon Hatfield, the Company's Chief Executive Officer. "With an independently audited mean estimate of 106 million barrels of prospective oil resources at Mil Qasim, we're excited to explore this structure, which is also the second of the three wells that make up our objective of discovering 800 million barrels of oil by mid-2012."
Drilling Mil Qasim-1 fulfills WesternZagros' work obligation under the first exploration sub period of the Garmian PSC. As Operator of the Garmian Block, WesternZagros is currently funding 100 percent of drilling operations until such time as a third party participant is assigned a 40 percent working interest in the Block by the Kurdistan Regional Government. The Company expects the gross costs associated with drilling and testing operations to be in the range of US$30 - 35 million. The delay in spudding this well was to ensure the drilling contractor met the Company's operational requirements.