TransGlobe Energy Corporation ("TransGlobe" or the "Company") is pleased to announce operating results for the the second quarter of 2009 in West Gharib Concession and Nuqra Block 1Egypt.
West Gharib, Arab Republic of Egypt (100% working interest, TransGlobe operated)
Operations and Exploration
Two wells were drilled during the second quarter, resulting in a dry hole (plugged and suspended) at Hana West #6 and a potential oil well undergoing testing at East Hoshia #3. A deep exploration well was drilling at East Hoshia #4 at quarter-end.
Hana West #6 was drilled to a total depth of 6,900 feet, encountering minor oil shows in the targeted lower Rudeis C zones. The well was plugged back and suspended pending a review of a sidetrack location to encounter the Asl C in a higher structural position.
East Hoshia #3 was drilled to a total depth of 9,320 feet targeting prospect in the Nubia reservoir. The well did not encounter the Nubia in a structurally favorable position and was subsequently plugged and suspended as a potential Thebes oil well on May 31. The well was re-entered and completed as a potential Thebes oil well in July. The well will be placed on test during August to evaluate the Thebes potential. The East Hoshia #3 well appears to be a separate accumulation, approximately 2.4 kilometers southwest of the East Hoshia prospect tested on wells #2 and #4.
East Hoshia #4 commenced drilling on June 6 and reached a total depth of 8,500 feet on July 23. The well is being completed as a potential Thebes oil well to test a 500 foot fractured carbonate section in the Thebes formation. Test results are expected by late August.
The drilling rig has moved to Hana West #7 to appraise the southern extension of the Hana West pool. A continuous exploration and development drilling program is planned for the balance of 2009.
The Company initiated extended water injection tests at Hana in July 2008 and at Hoshia in September 2008 to evaluate potential waterfloods for the respective fields. A positive pressure and oil production response was measured in the offsetting producers in the Hana field during the first quarter of 2009. Based on reservoir simulation work and positive field performance to date, the Company is moving forward with plans to design and implement full-field enhanced recovery projects at both Hana and Hoshia.
TransGlobe completed a 360+ km2 3-D seismic acquisition program covering the East Hoshia, Hoshia, North Hoshia, Arta and East Arta development areas in October 2008. The processed data was received at year-end and interpretation is proceeding.
Production from West Gharib averaged 6,384 Bopd to TransGlobe during the second quarter, up 1,020 Bopd over the previous quarter and representing a 70% increase in total field production from Q2-2008. The production increase is primarily due to the successful appraisal drilling at Hana West and improved pump performance at Hana and Hoshia.
Production averaged 5,395 Bopd during July, which was primarily impacted by pump replacements (scheduled and un-scheduled) which resulted in approximately 700 Bopd of shut-in Hana West production. This work has now been completed and production restored.
Nuqra Block 1, Arab Republic of Egypt (71.43% working interest, TransGlobe operated)
Operations and Exploration
The Company has entered the second exploration extension period, effective July 18, 2009. The second exploration period has a three-year term (expiry date of July 17, 2012) with a commitment to spend $5.0 million and drill two exploration wells. Prior to entering the second extension period, 25% of the original concession area (approximately 1.9 million acres) was relinquished. Effective July 18, 2009, the Nuqra concession area is approximately 3.7 million acres. The relinquished lands were not considered prospective by the Company.
TransGlobe has identified a prospect that appears to be similar to the oil discovery announced by a nearby operator at Al Baraka #1 and #2 on the Kom Ombo Concession, located immediately west of the Nuqra Concession. The Company has discussed rig-sharing possibilities with the adjacent operators to facilitate a potential 2010 drilling program.