Dana Petroleum has signed an agreement with Santos Egypt Pty Ltd (“Santos”) to acquire a 40% interest in the South East July Production Sharing Contract (“SE July PSC”), located in the Gulf of Suez, offshore Egypt.
This latest deal, which is subject to normal regulatory approvals, secures attractive new prospects for drilling in a core area for Dana and builds upon the five transactions the Company has already completed in Egypt.
Dana will operate the next well in the SE July PSC using the InterOcean-III jack-up drilling rig, which has just begun working for Dana in the Gulf of Suez.
Dana has contracted the InterOcean-III rig for an initial 8 month period, running from May 2008 continuously through until January 2009. The Company plans to firstly workover existing oil production wells and undertake infill drilling at its operated East Zeit producing oil field. Dana will then embark on an extensive exploration programme in the Gulf of Suez, including the first SE July well which Dana will drill on behalf of the joint-venture group.
The SE July PSC is situated within the same area of the Gulf of Suez as Dana’s existing producing oil infrastructure at East Zeit. Therefore the East Zeit production hub, operated by Dana, will provide a valuable development option for oil discoveries which may be made in the SE July PSC. This new concession is also in the same area as the North Ghara PSC, where Dana is working with BP and recently acquired new seismic data to identify and high-grade drilling targets.
Commenting on the news, Tom Cross, Dana’s Chief Executive, said:
"Dana is delivering significant business growth in Egypt, where it now holds production, development and exploration assets across the key oil and gas provinces of the Gulf of Suez, the Western Desert and the Nile Delta.
This latest deal utilises the expertise and operational capability of our team to add exciting new prospects into Dana’s portfolio, the first of which will be tested as part of the ongoing 2008 drilling campaign.
Dana is currently drilling two wells offshore Egypt, at West El Burullus in the Nile Delta and at West Gihan in the Gulf of Suez, and results from these are expected in the coming weeks."