WesternZagros Resources has increased its contingent resource estimates on the Kurdamir Block in the Kurdistan Region of Iraq to 590 million barrels of oil.
When gas and condensate are included the Mean Contingent Resources exceed 1 billion barrels of oil equivalent. These estimates were audited by independent reserves evaluator, Sproule International Limited.
“There’s a saying in the oil industry: big fields get better with time, and Kurdamir is proof of that. The Kurdamir structure has the potential to be the largest light oil field discovered in Kurdistan, with the possibility that it extends on to our neighbouring Garmian Block,” said Simon Hatfield, WesternZagros’ CEO. “We’re therefore highly motivated to drill the Kurdamir-3 well on the Kurdamir Block and the Baram-1 well on the Garmian Block this year to further delineate this giant discovery.”
The mean estimate of gross un-risked prospective resources (“Mean Prospective Resources”) for the Oligocene, Eocene and Cretaceous reservoirs combined is now 1.2 billion barrels of oil on the Kurdamir Block. When gas and condensate are included the Mean Prospective Resources equal 1.5 billion barrels of oil equivalent. As expected, these prospective resources have decreased from those previously announced primarily due to conversion from the prospective to the contingent category.
The mean contingent resources in the Oliogocene reservoir at Kurdamir have increased to 435 MMbbl of oil, up from the previously announced 147 MMbbl. After including gas and condensate, the mean contingent resources in the reservoir rise to 786 million barrels of oil equivalent (MMBOE).
This assessment also recognizes contingent resources in the Eocene reservoir on the Kurdamir Block for the first time. Mean Contingent Resources for the Eocene are 155 MMbbl of oil. When gas and condensate are included, the Mean Contingent Resources equal 226 MMBOE.
The company does not assess contingent resources for the Cretaceous reservoir due to insufficient confidence from test data.
The corresponding mean estimate of gross discovered petroleum initially-in-place (“Mean Discovered In-Place Resources”) increases to 2 billion barrels of oil. When gas and condensate are included, the Mean Discovered In-Place Resources equal 2.8 billion barrels of oil equivalent.
This is the fourth successive independently audited upward revision of contingent resources since the Kurdamir Discovery was announced in November 2009.
Based on reservoir data obtained from the Kurdamir testing program and independent engineering assessments, the Company predicts that sustainable production rates of 7,000 to 11,000 barrels of oil per day are possible for individual wells in the Oligocene reservoir utilizing horizontal drilling and completions technology. These sustainable production rates would follow higher initial flow rates. Horizontal wells will also minimize gas production from the oil leg where it underlies the gas cap.
The operator, Talisman (Block K44) B.V. (“Talisman”), is currently preparing to drill the Kurdamir-3 appraisal well in order to continue delineating the field. The anticipated spud date is early February 2013. In addition, the Company is currently preparing to drill the Baram-1 exploration well on the Garmian Block (see Figure 1). The Baram-1 well has the potential to prove the extension of the Kurdamir Discovery onto the Garmian Block. A 3D seismic program on the Kurdamir Block is also underway. WesternZagros and Talisman each have a 40 percent working interest in the Kurdamir Block with the Kurdistan Regional Government (“KRG”) holding the remaining 20 percent.
