Genel Energy has closed its previously announced acquisition of stakes in the Sarta and Qara Dagh onshore blocks in Iraq’s Kurdistan Region from Chevron following an approval from the Kurdistan Regional Government (KRG).
The deal, which was signed in January 2019, gives Genel Energy a stake of 30% in the Sarta block and 40% in the Qara Dagh block. The company’s partner in the Iraqi onshore block are Chevron with an operating stake of 50% and KRG, which holds the remaining stake of 20%.
Genel Energy said that a final investment decision regarding the Sarta phase 1A development has been made.
Phase 1A of the project will see drilling of two wells, recompletion of the Sarta-2 well and bringing the Sarta-3 well on stream. Both Sarta-2 and Sarta-3 flowed nearly 7,500 bopd on test.
Also included in the Sarta phase 1A development is the construction of a central processing facility with a capacity of 20,000 bopd.
The company expects to see another well added to the project within a year of first oil production. It also said that the production capacity will be increased with the development of the field and subsequent production ramps up.
The Sarta block is expected to produce its first oil in 2020, with Genel Energy’s share of the phase 1A development estimated to be $60m to the end of 2020.
The company, in a statement, said: “Genel has booked an initial 10 MMbbls of net 2P reserves relating solely to this preliminary phase of the project. Unrisked gross mid case resources relating to the Mus-Adaiyah reservoir only are estimated by Genel at c.150 MMbbls, with overall unrisked gross P50 resources currently estimated by the Company at c.500 MMbbls.”
In the Qara Dagh block, Genel Energy is now the operator and is partnered by Chevron (40%) and KRG (20%).
The company said that the partners are currently evaluating the optimal location for the Qara Dagh-2 well, which is scheduled to be drilled in 2020. Unrisked gross mean resources at the onshore Iraqi block as per the company’s current estimations are around 200 MMbbls.