gulf sand reservoir properties
DESCRIPTION
This presentation is designed to provide information about Gulfsands Petroleum plc and its business and operations. It is intended as general information only and is not to be relied upon for any particular purpose. In particular, no information contained in this presentation constitutes, or shall be deemed to constitute, an invitation to invest or otherwise deal in any securities of Gulfsands Petroleum plc. Although we endeavor to ensure that the content of this presentation is accurate and up-to-date, Gulfsands Petroleum plc gives no representation or warranty as to the accuracy or completeness of any information contained in this presentation.TRANSCRIPT
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Gulfsands Petroleum plc
Corporate Presentation
June 2007June 2007
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2 Oil and Gas Discovery (Khurbet East) in Syria Block 26 31% increase in 2006 USA 2P reserves 2006 Turnover approximately US$30 million 2006 Gross Profit of $11 million
HoustonUS Gulf Coast and Gulf of Mexico
Development, Production & Exploration
LondonAIM listing, brokerage, corporate
finance, investor relations
Block 26 PSC (Syria)Exploration
Misan Gas Project (Iraq)Business Development
Gulfsands Petroleum Highlights
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3-
500
1,000
1,500
2,000
2,500
3,000
b
o
e
p
d
1H 2004 2H 2004 1H 2005 2H 2005 1H 2006 2H 2006
Average Daily Oil & Gas Production
Gas (boepd)Oil (boepd)
Company Performance
Production recovering after hurricane disruptions
-
5,000
10,000
15,000
20,000
25,000
30,000
U
S
$
(
'
0
0
0
)
2004 2005 2006
Turnover and Gross Profit
TurnoverGross Profit
Average daily oil production returned to pre-hurricane level for 2H 2006
Daily gas production returned to pre-hurricane level during 2H 2006
Continued increase in turnover
$11 million gross profit in 2006
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4USA Reserves 31st December 2006 Proved + Probable Possible Total (BCFGE)
(MMBOE) (BCFGE) (MMBOE) (BCFGE) (MMBOE)
Gulf of Mexico
41.5 6.9 2.1 0.3 43.6 7.2
Onshore Gulf Coast 3.1 0.5 4.7 0.8 7.8
1.3
Total 44.6 7.4 6.8 1.1 51.4
8.5
2P reserves increased by 31% to 7.4 MMBOE
Replaced 389% of 2006 oil and gas production
In-field additions in key properties and acquisition of additional interest in Emily Hawes gas field
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5USA Gulf of Mexico
Gulfsands has assets in the Gulf of Mexico because of
High production rates, steady cash flow Geographically diverse portfolio, existing infrastructure Record of success
Forward Plans
Focus on existing opportunities Conversion of non-producing reserves to PRODUCTION
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6USA Gulf Coast
Gulfsands has assets in the Gulf Coast region because of
Low cost operating environment Short cycle time from opportunity capture to production Production diversification
Forward Plans
Focus on field re-development and exploitation
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7Current Operations - USA
Focus on existing opportunities Selective work-overs and re-completions to enhance
production and increase reserves Re-establish production at Emily Hawes Field (operated)
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8Syria
Gulfsands has assets in Syria because
Block 26 is a large, contiguous block (11,050 sq. km.) with existing infrastructure in a proven petroleum province Senior in-country staff with extensive regional experience Ideal point of entry for continued operations in the region
Forward Plans
Khurbet East appraisal and development in Block 26 Exploration drilling in Block 26 Active development project acquisition strategy
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92005
2005 2D Seismic Acquisition & Processing
Souedieh North-1 (Cretaceous Strat Play)
2006 2007
Tigris-1 (Palaeozoic reservoir)
2006 2D Seismic Acquisition & Processing
KHE-1
KHE-2
Gulfsands becomes Operator of Block 26 PSCEmerald (SNG Overseas) obtains 50% WI in JV
3D Seismic Acq. & & Processing
Notice to enter First extension (23 July)
First extension commences (23 August)
Syria Block 26 - Operations
68 6 7 00 736 70063 6 7 00
4 0 34 700
4 0 84 700
4 1 34 700
S y r i a
Turke y
Ira q
Block 26
Rumeilan
Ullayan
Bab Al Hadid
Badran
Maashok
Lelac Derik
Karatchok
Khurbet
Naour
Matl out
A l Bardeh
Tel Barak
Al Bouab
Sheikh Mansour
Abu Haydar
Al Hol
Sheik Suleiman
Souedi eh
OudehKahtaniyeh
Sham ou
Zuraba
0 30 km
Note; wells not shown in fields witha high density of dri lling.
68 6 7 00 736 70063 6 7 00
4 0 34 700
4 0 84 700
4 1 34 700
S y r i a
Turke y
Ira q
Block 26
Rumeilan
Ullayan
Bab Al Hadid
Badran
Maashok
Lelac Derik
Karatchok
Khurbet
Naour
Matl out
A l Bardeh
Tel Barak
Al Bouab
Sheikh Mansour
Abu Haydar
Al Hol
Sheik Suleiman
Souedi eh
OudehKahtaniyeh
Sham ou
Zuraba
0 30 km
Note; wells not shown in fields witha high density of dri lling.
Tigris
Khurbet East
Tigris-1
SN-1
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10
Khurbet East Oil and Gas Discovery KHE-1, drilled to a total depth of 3800 meters, is the first well drilled within the Khurbet East
structure
The well intersected four significant hydrocarbon bearing zones in Tertiary, Cretaceous and Triassic aged reservoirs
~35o API oil flowed to surface on drill-stem test (DST) from the Triassic aged Kurrachine Dolomite Formation
Natural gas was recovered via wireline sample from the Triassic aged Butmah Formation
~24o API oil was recovered via wireline sample from the Cretaceous aged Massive Formation
Core was recovered from the Tertiary aged Chilou Formation. Wireline sampling was not possible due to the large hole size required at this depth in the KHE-1 well-bore
KHE-1 will be suspended as a future Kurachine Dolomite oil production well
The first appraisal well for Khurbet East, the KHE-2 well, is specifically designed to further evaluate the shallower Tertiary and Cretaceous reservoirs within the Khurbet East structure
The KHE-2 well is scheduled to spud in mid-June
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11
Khurbet East Location
686 700 736 700636 700
4 034 700
4 084 700
4 134 700
S y r i a
Tur k e y
I raq
Block 26
Rumeilan
Ullayan
Bab Al Hadid
Badran
Maashok
Lelac Derik
Karatchok
Khurbet
Naour
Matlout
Al Bardeh
Tel Barak
Al Bouab
Sheikh Mansour
Abu Haydar
Al Hol
Sheik Suleiman
Souedieh
OudehKahtaniyeh
Shamou
Zuraba
0 30 km
Note; wells not shown in fields witha high density of drilling.
KHE-1Oil
pipelin
e
686 700 736 700636 700
4 034 700
4 084 700
4 134 7004 134 700
S y r i a
Tur k e y
I raq
Block 26
Rumeilan
Ullayan
Bab Al Hadid
Badran
Maashok
Lelac Derik
Karatchok
Khurbet
Naour
Matlout
Al Bardeh
Tel Barak
Block 26
Rumeilan
Ullayan
Bab Al Hadid
Badran
Maashok
Lelac Derik
Karatchok
Khurbet
Naour
Matlout
Al Bardeh
Tel Barak
Al Bouab
Sheikh Mansour
Abu Haydar
Al Hol
Sheik Suleiman
Souedieh
OudehKahtaniyeh
Shamou
Zuraba
0 30 km
Note; wells not shown in fields witha high density of drilling.
KHE-1Oil
pipelin
e
The KHE-1 well, the first well in the Khurbet East structure, is located within 12 km of the Souedieh and Rumeilan Oil Fields, as well as their associated oil export pipeline
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12
KHE-1 Chilou Reservoir - Structure
Line K
N-40
KHE-1Discovery well
KHE-2Appraisal well for Chilou and Massive Formations
Area of structure at Chilou level ~ 5.5 km2
KHE-2 will aid in determining the extent of the accumulation
10 km
The Tertiary aged Chilou Formation contains the youngest, and shallowest, reservoir that is within structural closure on the Khurbet East horst block
The magnitude, and area, of the Khurbet East structure increases with depth
Chilou
KHE-1
Cross-section based on seismic line KN-40
KHE-2
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13
KHE-1 Chilou Reservoir AssessmentMain pay zone assessment
Cored interval based on shows and drilling break (8.5 m core recovered)
88m gross pay interval (1316m 1404m) based on wireline logs
26m net pay calculated within interval
31% average porosity calculated in net pay section
Large diameter hole size at this depth in KHE-1 prevented acquisition of oil samples
Reservoir permeability and oil quality to be confirmed via KHE-2 appraisal well
Chilou
KHE-1
Cross-section based on seismic line KN-40
KHE-2
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14
KHE-1 Massive Reservoir - Structure
The vast majority of oil production in the area comes from reserves contained in Cretaceous aged Massive reservoirs (e.g. Souedieh, Karatchok Fields)
10 km
Line K
N-40
KHE-1Discovery well
KHE-2Appraisal well for Chilou and Massive Formations
Area of structure at Massive level 8.5 km2 13.5 km2
KHE-2 will aid in determining the extent of the accumulation
The KHE-2 well will not drill to the Kurrachine Dolomite
Chilou
KHE-1
Cross-section based on seismic line KN-40
KHE-2
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15
KHE-1 Massive Reservoir - Assessment
Wireline logs and pressure samples indicate an oil discovery
~25m gross / 22m net pay
Definitive water contact not encountered
Average porosity of 16-17% with good permeability
Reservoir pressures indicate potential for >40m oil column
Oil sample recovered, PVT analysis indicates 24o API
Further evaluation of the Massive reservoir is the primary objective of the KHE-2 well
Live oil shows during drilling
Increased hydrocarbon shows and gas readings over 40-50 meters (consistent with large case mapping)
Lost circulation while drilling prevented core recovery
OILCOLUMN
OILOILCOLUMN
OIL
'Massive Reservoir' Formation Pressure
Gradient = 0.367 psi/ft
R2 = 0.9988
PSIA
D
e
p
t
h
'Massive Reservoir' Formation Pressure
Gradient = 0.367 psi/ft
R2 = 0.9988
PSIA
D
e
p
t
h
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16
KHE-1 Butmah Reservoir - Structure
10 km
KHE-1
Line K
N-40
Area of structure at Butmah reservoir ~15.5 km2
Gas was recovered from this reservoir via wireline sampling
Additional drilling is likely required in order to determine if an oil-leg is present in this reservoir
The KHE-2 well will not drill to the Butmah reservoir
Chilou
KHE-1
Cross-section based on seismic line KN-40
KHE-2
Gas was recovered via wireline sample from this reservoir
Further drilling (appraisal/development) may delineate an oil leg below the gas column
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17
KHE-1 Butmah Reservoir - Assessment
Live oil/gas shows during drilling
Core recovered after drilling break
Wireline logs and pressure samples indicate a hydrocarbon-bearing reservoir
Very good porosity and permeability interpreted in main pay zone
Gas sample recovered from near top of pay zone
No definitive contact(s) identified
2850
2900
0 1(frac) 1 0(frac) 0.5 0(frac) 0.01 1000(mD)
Gas sample
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18
KHE-1 Kurrachine Dolomite Reservoir -Structure
10 km
KHE-1
Line K
N-40
Area of structure at Kurrachine Dolomite reservoir ~15.5 km2
There is potential for oil pay in this reservoir in excess of the structural closure
This could be explained by
Presence of 2 or more separate accumulations within the Kurrachine Dolomite, or
A stratigraphic component to the trap, providing for additional hydrocarbon column
The KHE-2 well will not drill to the Kurrachine Dolomite
Chilou
KHE-1
Cross-section based on seismic line KN-40
KHE-2
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19
KHE-1 Kurrachine Dolomite Reservoir -Assessment
Core recovered after drilling break
Significant live oil/gas shows during drilling
Wireline logs indicate a hydrocarbon-bearing reservoir
Poor hole conditions (common occurrence in this formation) significantly increases the uncertainty in estimating gross and net pay from wireline logs
Low case net pay estimate of 20 meters, high case net pay estimate of 120 meters
An open-hole drill-stem test (DST) was undertaken over a gross 100 meter interval in the Kurrachine Dolomite
DST intervalDST interval
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20
KHE-1 Kurrachine Dolomite DST results
Oil flow to surface at rates of up to 478 bopd with an average GOR of ~2000 scf/bbl. Oil gravity is ~35o api
Very encouraging flow of light oil on DST, we anticipate strong performance once production tubing is in place
We are investigating methods for optimising production from this reservoir. These may include
Specialised acid stimulation of the reservoir, or
Horizontal wells
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21
Khurbet East The Future
Approximate structural closure at Butmah and Kurrachine Dolomite levels
Composite map showing how accumulations at different stratigraphic levels overly one another within the Khurbet East structure
Approximate structural closure at Massive
Approximate structural closure at Chilou
KHE-1
10 km
The KHE-1 well demonstrated the existence of multiple hydrocarbon accumulations at different stratigraphic levels. The results so far have exceeded the pre-drill expectations, with the Company estimating gross recoverable resource potential in excess of 100 mmbbls.
The Company envisions
A Triassic reservoirs development (primarily the Kurrachine Dolomite Formation), and
A shallow reservoirs development (primarily the Cretaceous Massive Formation)
The Company is proceeding with plans to fast-track development of this discovery, with
Appraisal beginning immediately, and
Plans for 3D seismic acquisition over the structure and surrounding leads
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22
Khurbet East Room to Run
The Company has identified a number of leads in the vicinity of the Khurbet East discovery, based on 2D seismic data.
The Company is preparing plans to acquire a 3D seismic survey directly over the Khurbet East structure and surrounds. These data will aid in the optimal selection of development drilling locations as well as any near-field exploration drilling locations.
In conjunction with the development 3D seismic programme, the Company is considering additional exploration oriented2D or 3D seismic programmes to evaluate an additional cluster of structural leads in the area.
KHE-2KHE-1
~150 km2 Development and near- field 3D
Southern leads
10 km
Existing 2D seismic lines
Khurbet East
Near- field structure identified on 2D seismicKHE-2
KHE-1
~150 km2 Development and near- field 3D
Southern leads
10 km
Existing 2D seismic lines
Khurbet East
Near- field structure identified on 2D seismic
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23
Project Acquisition Syria and Iraq
Gulfsands has competitive advantages in the region
Senior executives with local experience and local knowledge Proven local operational capability Political risk = opportunities
Forward Plans
Conclude definitive agreement for Maysan Project Natural gas development projects Oil exploration and development projects in Kurdistan
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Project Acquisition - Syria
Syria
Iraq
Block 26
Secure Syrian gas development opportunity
Secure cross border gas development and distribution opportunities
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25
Project Acquisition - Iraq
0 50 100 150 20025
Km
0 50 100 150 20025
Km
0 50 100 150 20025
Km
0 50 100 150 20025
Km
IraqSyriaWestern Desert
Kurdistan
Southern Region
Block 26 3 Focus Areas
Southern Region Mid-stream Maysan Project Related oil developments
Western Desert Leverage Syrian presence Regional gas initiative
Kurdistan Extend Block 26 operating
capabilities Exploit geographical proximity
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Southern Region - Maysan Project
Mid-stream development, gas gathering and liquids extraction in existing and developing fields
Low technical risk, high value potential
MOU signed January 2005
Requires definitive contract negotiation and execution
NPV potential in excess of $2 billion
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27
Southern Region - Maysan Project
MaysanMaysanProject AreaProject Area
L E G E N D
Misan NGL Recovery PlantKhur Zubair NGL Fractionation PlantMisan FieldsAdjacent FieldsGathering LineNGL LineResidue Gas Line
L E G E N D
Maysan NGL Recovery PlantKhur Zubair NGL Fractionation PlantMaysan FieldsAdjacent FieldsGathering LineGathering LineNGL LineNGL LineResidue Gas LineResidue Gas Line
IRAQ
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Maysan Project 450 MMCFD NGL Plant, gathering system and pipelines
Project to produce approximately 338 mmcf/d sales gas and 46,600 bbls/d of NGL
Build planned in 2 Phases over 5 yrs
First production 3 years after completion of FEED
Cumulative production of 2.6 TCF sales gas and 356 million barrels of NGL over 25 years
Maysan Project Forecast Daily Production Profile
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The next 12 months Appraise and commence Khurbet East development within Block 26
Acquire development project in Syria
Sign Maysan Project, KRG PSC or other Development project in Iraq
US Production and Reserves Acquisition
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30
This presentation is designed to provide information about Gulfsands Petroleum plc and its business and operations. It is intended as general information only and is not to be relied upon for any particular purpose. In particular, no information contained in this presentation constitutes, or shall be deemed to constitute, an invitation to invest or otherwise deal in any securities of Gulfsands Petroleum plc.
Although we endeavor to ensure that the content of this presentation is accurate and up-to-date, Gulfsands Petroleum plc gives no representation or warranty as to the accuracy or completeness of
any information contained in this presentation.
-
Gulfsands Petroleum plc
Corporate Presentation
June 2007June 2007
Gulfsands Petroleum HighlightsCompany PerformanceUSA Reserves 31st December 2006USA Gulf of MexicoUSA Gulf CoastCurrent Operations - USASyriaSyria Block 26 - OperationsKhurbet East Oil and Gas DiscoveryKhurbet East LocationKHE-1 Chilou Reservoir - StructureKHE-1 Chilou Reservoir AssessmentKHE-1 Massive Reservoir - StructureKHE-1 Massive Reservoir - AssessmentKHE-1 Butmah Reservoir - StructureKHE-1 Butmah Reservoir - AssessmentKHE-1 Kurrachine Dolomite Reservoir - StructureKHE-1 Kurrachine Dolomite Reservoir - AssessmentKHE-1 Kurrachine Dolomite DST resultsKhurbet East The FutureKhurbet East Room to RunProject Acquisition Syria and IraqProject Acquisition - SyriaProject Acquisition - IraqSouthern Region - Maysan ProjectSouthern Region - Maysan ProjectMaysan ProjectThe next 12 months