Sea Dragon Increases Production to 1,700 Boepd with the Acquisition of
Shukheir Marine and the Start of Gas Sales in NW GEMSA
CALGARY, Feb. 14, 2013 /CNW/ - Sea Dragon Energy Inc. ("Sea Dragon" or the
"Company") (TSX VENTURE: SDX) is pleased to announce the following operational
update for its recent work activities in Egypt.
FUTURE OUTLOOK: In 2013 the company's capital budget is expected to be
approximately $6.0 million to be financed entirely from existing cash flow.
Average production is expected to average 1,725 boe/d, an increase of
approximately 700 boe/d over 2012.
Sea Dragon is continuing to fully exploit its existing assets and expand its
operations in Egypt while seeking new high impact opportunities in the MENA
region and sub-Saharan Africa.
NW GEMSA CONCESSION
The NW Gemsa concession is located onshore on the west side of the Gulf of
Suez, approximately 300 km southeast of Cairo. Two main oil fields are
producing light oil, the Al Amir SE field along with the Al Ola extension to
the south and the Geyad field to the north. Sea Dragon has a 10% working
interest in the NW Gemsa Concession with Vegas at 50%, as operator and Circle
Oil PLC with 40%.
Current production from the Al Amir SE and Geyad fields is approximately
10,350 boe/d gross (1,035 net). Currently producing wells include seven at Al
Amir SE field, two at Al Ola and four at Geyad. Cumulative production from
the NW Gemsa Concession has now exceeded 10.4 million barrels of 42 degree API
The gas conservation project is now complete and solution gas conservation and
incremental liquids production commenced on February 12, 2013. Preliminary
volumes are 7.2 mmcf/d (720 mcf/d net) of sales gas, 150 bpd (15 bpd net) of
condensates and 38 tons (3.8 net) of LPG's/day.
Water injection is ongoing with four injectors currently operating at Al Amir
SE Field and one injector at Geyad Field. Current total injection rates are
approximately 14,500 bwpd. Cumulative injection to date is 6.6 million
barrels at Al Amir SE and 1.6 million barrels at Geyad.
Al Amir SE-14 ST#2 Well:
This development well was spud on November 26(th )with the objective of
appraising the Shagar and Rahmi reservoirs between the Al Ola-1x and Al Amir
SE-12ST wells. The second side track hole was successfully drilled to its
total depth of 10,000 feet and encountered net oil pays in both the Shagar and
Rahmi reservoirs with 16 feet and 13 feet respectively.
Beyond the drilling of Al Amir SE-14, future plans at NW Gemsa include the
drilling of three additional water injectors and one producer in 2013, after
which the rig is expected to be farmed out.
Total 2013 capital expenditures in NW Gemsa are expected to be US$ 30 (3 net)
million and total gross production is expected to average 10,000 (1,000 net)
SHUKHEIR MARINE CONCESSION:
The Shukheir Marine Concession is located in the shallow offshore waters of
the Gulf of Suez approximately 300 km southeast of Cairo. Following the
acquisition of 100% interest in the concession which contains both the
Shukheir Bay and Gamma oil fields, Sea Dragon began a comprehensive review of
the upside potential believed to still exist in both fields.
Short term and within the next two months, the company plans to conduct an
acid stimulation treatment in the Gamma #1 well and a work over and
recompletion operation in the Shukheir Bay #5 well. With success these
operations could result in a production increase of 100-200 bopd.
Exploratory drilling opportunities may also exist in the Gamma concession,
prospecting the prolific Nubia Formation and in the Shukheir Bay field in the
Upper and Lower Rudeis Formations.
Current production from the concession is 415 bopd. Sea Dragon is the sole
owner and operator of the concession.
Total 2013 capital expenditures in Shukheir Marine are expected to be US$ 1.0
million and total production is expected to average 470 bopd.
KOM OMBO CONCESSION
The Kom Ombo Concession is located onshore in the southern part of Egypt some
1,000 km south of Cairo. It contains the Al Baraka and the newly discovered W.
Al Baraka oilfields, producing light oil from multiple reservoirs. Sea
Dragon owns a 50% working interest and is a joint operator of the Kom Ombo
Concession with Dana Gas owning the remaining 50%.
West Al Baraka #2 Well: The well was completed in December 2012 and placed on
an extended production test. Production rates averaged 120 to 250 bopd. The
well is currently shut in awaiting a bottom hole pump replacement.
As a result of the successful completion and testing of the well, a
Development Lease was recently granted by the Petroleum Ministry.
Once the development plan is granted, an appraisal/development drilling
program will commence which could involve the drilling of up to three new
Total 2013 capital expenditures in Kom Ombo are expected to be US$ 4 (2 net)
million and total gross production from existing wells is expected to average
510 (255 net) bopd.
Current production from the Al Baraka field is approximately 500 gross (250
Certain statements contained in this press release constitute "forward-looking
statements" as such term is used in applicable Canadian and US securities
laws. These statements relate to analyses and other information that are based
upon forecasts of future results, estimates of amounts not yet determinable
and assumptions of management. In particular, statements concerning the 2012
drilling and capital expenditure programs of the NW Gemsa and Kom Ombo
Concessions and the results referenced or implied herein should be viewed as
Any statements that express or involve discussions with respect to
predictions, expectations, beliefs, plans, projections, objectives,
assumptions or future events or are not statements of historical fact and
should be viewed as "forward-looking statements". All reserves information
contained herein as well as the net present value of such reserves should be
considered as forward looking statements. Such forward looking statements
involve known and unknown risks, uncertainties and other factors which may
cause the actual results, performance or achievements of the Company to be
materially different from any future results, performance or achievements
expressed or implied by such forward-looking statements. Such risks and
other factors include, among others, costs and timing of exploration and
production development, availability of capital to fund exploration and
development and political, social and other risks inherent in carrying on
business in Egypt. There can be no assurance that such statements will prove
to be accurate as actual results and future events could vary or differ
materially from those anticipated in such statements. Accordingly, readers
should not place undue reliance on forward-looking statements contained in
this news release.
Forward-looking statements are made based on management's beliefs, estimates
and opinions on the date the statements are made and the Corporation
undertakes no obligation to update forward-looking statements and if these
beliefs, estimates and opinions or other circumstances should change, except
as required by applicable law. Although Sea Dragon has attempted to identify
important factors that could cause actual actions, events or results to differ
materially from those described in forward-looking statements, there may be
other factors that cause actions, events or results not to be as anticipated,
estimated or intended. Investors are cautioned that such forward-looking
statements involve risks and uncertainties. Actual results may differ
materially from those currently anticipated. See Sea Dragon's Annual
Information Form for the year ended December 31, 2011 for a description of the
risks and uncertainties associated with the Company's business, including its
exploration activities. The forward-looking statements contained herein are
expressly qualified by this cautionary statement.
NEITHER THE TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER (AS THAT
TERM IS DEFINED IN THE POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS
RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THE RELEASE.
Said Arrata Chairman, CEO and Director (403) 457-5035
Tony Anton President, COO and Director (403) 457-5035
Olivier Serra Chief Financial Officer and Director +331 5343 9442
Brisco Capital Partners Corp. Investor Relations (403) 262-9888
SOURCE: Sea Dragon Energy Inc.
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