Mark Reid, CEO of SDX, commented: "We are very pleased to have secured this ten-year extension to the Production Services Agreement which we estimate increases SDX's share of reserves in our core West Gharib oil asset, certified at 2.2 million barrels in our 31 December 2019 CPR, by 60%. With a breakeven price of approximately US$20 Brent and to take advantage of the current strong oil price, we plan to commence in Q2 of this year, a drilling programme of up to twelve wells over the next three years with the goal of growing gross production back to around 3,000bbl/d. This drilling programme is in line with the CAPEX guidance provided to the Market in our 26th January 2021 update.
We would like to thank our partners The General Petroleum Company, a wholly owned subsidiary of the Egyptian General Petroleum Corporation, and Dublin Petroleum Limited for their valuable co-operation in agreeing this extension."
The extension, in which SDX has a 50% working interest, includes a commitment, irrespective of Brent price, to drill six development wells by 31 December 2022 and one water injection well. If Brent reaches US$55 for 12 consecutive months during the extension period, four further development wells will be drilled during the extension period. If Brent reaches US$60 for 12 consecutive months during the extension period, two further development wells will be drilled during the extension period.
Read the latest issue of Oilfield Technology in full for free: Oilfield Technology's November/December 2020 issue
The November/December issue of Oilfield Technology begins by reviewing the state of the North Sea before moving on to cover a range of topics, including Drilling Technologies, Deepwater Operations, Flow Control.
Contributors come from Varel Energy Solutions, Gyrodata, Clariant Oil Services, Drillmec and many more.
Read the article online at: https://www.oilfieldtechnology.com/drilling-and-production/05032021/sdx-energy-secures-10-year-extension-to-west-gharib-production-services-agreement/