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Egypt

Friday, May 29 2009 by
7

Okay, so perhaps Egypt (WEEM) is not seen as the most improtant asset in the Aminex portfolio but I thought it woudl be interesting to point out some developments there.

The main partner is Groundstar Resources, (TSX-V GSA) Aminex have the 10% interest freee carried through to commercial production IIRC. The first wells havent found anything but, in the IMS:  http://www.investegate.co.uk/Article.aspx?id=200905190700114549S there was a very short mention of Egypt:

 

EGYPT


West esh el Mellahah Block 2 ('WEEM-2'), onshore Gulf of Suez:


One or more further exploration wells will be drilled in 2009. Aminex has a 10% beneficial interest in WEEM-2 and its share of costs is carried by other partners through to first commercial production.  


WEEM-2 is operated by Aminex Petroleum Egypt Ltd., in which Aminex is a shareholder.

Now one of the majorr concerns about this has obviously been the ability of the partners to fund any new wells. It is therefore interesting to note that GSA have been very busy in recent weeks:

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Firstly they reduced their interest in their property in Guyana to a 10% carried interest (to first commercial production) via a sale of part of their interst to CanacolL

http://www.groundstarresources.com/news/news.php?newsID=694

Now they have completed a funding issue:

Oddly that isnt on the website yet as it was only issue dlate last night:

Groundstar Resources Limited ("Groundstar") (TSX VENTURE:GSA) is pleased to announce that it has closed its previously announced non-brokered private placement (the "Offering") of 13,500,000 common shares ("Common Shares") at a price of $0.15 per Common Share for aggregate gross proceeds of $2,025,000. A finder's fee (the "Finder's Fee") of $191,610 was paid, equal to 10% of the gross proceeds raised on 12,774,000 shares by a finder (the "Finder"). In addition, the Corporation issued common share purchase warrants (the "Finder's Warrants") to the Finder to purchase 12,774,000 Common Shares. The Finder's Warrants will entitle the holder to purchase one Common Share at an exercise price of $0.16 for a period of five (5) years from date of closing of the Offering.

Proceeds from the Offering will be utilized to fund ongoing exploration and development activities in Groundstar's high potential blocks in Egypt, Kurdistan region of Iraq and for general corporate purposes. The Common Shares and Finder's Warrants issued upon closing of the Offering are subject to a 4-month hold period from the date of issue.

Groundstar is a publicly traded Canadian junior oil and gas company actively pursuing exploration opportunities in Guyana, North Africa and the Middle East.

So, apart from the placees making a bomb on the funding (GSA is now 53 cents) it appears that they have nicely bolstered their coffers and perhaps we can look forward to renewed work on WEEM? Mind you, GSA also has a very attractive block in West Komombo (right next door to Dana Gas' (ex Centurion Energy) acreage.

Just though it might be of interest.

D

 


Disclaimer:  

The opinions expressed by the author are those made by him personally as an individual and not in any professional capacity. 


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Aminex PLC is engaged in the exploration for, and the development and production of oil and gas reserves. Its principal area of activities includes the United States, East Africa, North Africa and North Korea. Its segments include Producing Oil and Gas Properties, Exploration Activities and Oilfield Services and Supplies. The Company's licenses in Tanzania include Nyuni PSA, Kiliwani North and Ruvuma PSA. During the year ended December 31, 2010, it drilled three wells, one in Tanzania and two in the United States. As of December 31, 2010, the Company held leases at Shoats Creek covering approximately 2,100 acres. Aminex Oilfield Services & Supply Company (AMOSSCO), its wholly owned subsidiary, provides logistics services to oil industry and sources oilfield equipment and consumables to international oil companies. In October 2013, Aminex Plc announced the sale of its producing gas wells at the South Weslaco Field, Hidalgo County, Texas to Northcote Energy PLC. more »

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56 Posts on this Thread show/hide all

marben100 27th Oct '09 37 of 56
1

For the geologically inclined, I've found an interesting paper on the Gulf of Suez region: http://www.megeuae.com/SharhanPDFpubs/Petroleum-Geology-Gulf-Suez/Common-Source-Rock.pdf

Pre-Miocene Source Units

Pre-Miocene source units are preserved in the Duwi, Sudr, and Matulla formations. The only available geochemical data for these intervals are that from West Hurghada 1 and Umm Agawish 1 wells (Figure 2). The richness of the Matulla Formation is readily apparent from the fact that TOC greater than 3.0% and S2 values greater than 6.0 kg/ton are common. The upper Senonian carbonates (Duwi and Sudrformations) are the primary source units in the Gulf of Suez (Rohrback, 1982). Where these carbonates are measured in the study area, their richness is indicated by a TOC content as high as 12% in the West Hurghadawell, and the measured pyrolysis yield (Sv as high as 18 kg/ton.

 

 

[TOC = Total Organic Carbon]

Doesn't mean much to me but the paper contains some excellent descriptions of the stratigraphy and it might help someone with more expertise than I have to interpret today's announcement.

Probably not too much point guessing, though - best to wait for the test results, I imagine.

Cheers,

Mark

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SW10Chap 27th Oct '09 38 of 56
10

In reply to emptyend (post #23)

Perhaps SW10 or someone else with knowledge of well logs might care to comment

I think it's all been said - C1-C5 is exactly as oilretire and lsn have said.

As for 'stringers', as db's Googling suggests, these are rather like lenses or sometimes channels of a particular deposit - in this case sand.Not really going to be a prolific reservoir though, if they're just depending on the stringers.

Just one slightly unusual thing about this release, it says:

The well was logged from the base of the last cased section at 2,725 feet to total depth.

Wireline logging is almost always done from the bottom upwards and I would expect anyone describing or recounting a logging programme would say that The well was logged from TD to the base of the last cased section at 2,725 feet - unless it was actually logged downwards.

Downward logging does happen, and it's usually under circumstances where a failure of equipment or severe problems with the well are anticipated. The quality is not as good, but at least some data can be recovered before the wireline tools are either lost or fail. Anticipated failure usually suggests a well of extreme temperatures, and I doubt that's the case here.

Building guesswork on top of conjecture, and being thousands of miles away, I wonder if the hydrocarbons are actually causing some sort of well-control problems?

SW10

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DearLeader 27th Oct '09 39 of 56

re. C4/5

Post 20 has a section of text copied from the link above it pretty much as soon as it was released. That link no longer says C4 but C5. The release presumeably had a typo, and was then updated to C5.

Looking forward to the Oilbarrel reports/presentation tommorrow.

cheers
DL

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marben100 27th Oct '09 40 of 56
1

Damn - reply not working again- so, manually: re #38

Eh up SW10... do you think this may have some relevance?

 

Muzhil-3 also presented encouraging oil and gas shows in the thick Eocene fractured carbonate layer, however, the company is awaiting further acid frac investigations in order to confirm the results of these highly fractured and vuggy formations. 

The well also penetrated Nubia sandstone at a depth of 130 feet below the Matulla, a new discovery not just for the well, but for the entire concession.

Nubia sandstone is considered to be among the best reservoirs in the Gulf of Suez based on production. 

“This Nubia discovery is a new zone for us. It has a very high reservoir pressure of approximately 5,300 psi and a good productivity index. Initial tests were at 600 barrels per day due to the high gravity oil, which will require extensive pumping. However, our reservoir engineers predict that through the use of enhanced oil recovery methods, the output could potentially increase,” said NPC Chairman, Salah Hafez.

 

[my bold]

Cheers,

Mark

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marben100 28th Oct '09 41 of 56

To (partly) answer my own question, I learnt at today's presentation that the Nubia sandstone was NOT penetrated by this well... so probably not of huge relevance.

Cheers,

Mark

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oilretire 29th Oct '09 42 of 56
3

Couple of interesting links thanks to mostlygone on ADVFN

http://www.hkexnews.hk/listedco/listconews/sehk/20091028/LTN20091028153.pdf

Subject to further testing, the Company will then consider whether or not to drill further down as our technical team in Cairo suspects there may exist other pay zones beneath current depth.

Is leaving the bottom 170ft uncased just to permit testing of the possible fractured Granite Wash and Basalt or is there sense in not casing the lower section if they do decide to drill further? Someone with well completion knowledge might comment? Regardless, it's interesting that drilling might not be over yet.........

And some good background info on WEEM here:

http://kte.ktg.com.hk/kte_oil_field_information.jsp

Map shows the gas and oil lines running through the block.

map.jpg

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gjelly 29th Oct '09 43 of 56
4

The normal way of testing/producing fractured basement is by open hole. The logic is that running casing/liner and cementing will push cement into the fractures and even perforating with deep penetrating guns will not regain access. So I guess the logs showed some indiations of hydrocarbon in the basement and the decision was made to set the casing high and test it.
If the well was drilled deeper it is highly unlikely/impossible that there would be additional reservoirs deep within the granite but if the fractures continue there would be water below an oil water contact. So the sensible option is to test what you have found to prove up the prospect and then appraise it with additional wells to find the contacts.

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emptyend 29th Oct '09 44 of 56
2

Just one point on this, which may or may not be significant. The RNS said:

The well will be cased to 11,030 feet leaving the bottom 170 feet uncased in order to conduct an open hole test of possible fractured Granite Wash and Basalt

Basalt is a volcanic extrusion http://en.wikipedia.org/wiki/Basalt. It is therefore NOT the same as "basement", which carries the implication of a thicker, more solid layer. Exactly what this distinction might suggest, if anything, is something that will have to be left to geologists once they have the test data in, but one cannot jump to conclude (AFAIAA, based on what is known so far) that the basalt/granite wash layer is either a) thick or b) not overlying other zones of interest.

ee

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SW10Chap 30th Oct '09 45 of 56
6

In reply to emptyend (post #44)

Just one point on this, which may or may not be significant.

To be even more clear, the point is significant. The outcome may or may not be ;-)

It's perfectly possible that basalt has intruded its way into formations of potentially-interesting reservoir and, depending on its nature, may even be a cap-rock.

SW10

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D1G3Y 9th Dec '09 46 of 56

A live example of SW10's law in action. 6 weeks and counting since last RNS......

http://www.aminex-plc.com/files/091027_South_Malak-1_well_to_be_tested.pdf

Hopefully it will be worth the weight

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djpreston 10th Dec '09 47 of 56
3

In reply to D1G3Y (post #46)

Indeed - thank goodness we arent paying for anything on Weem eh?

I think its pretty evident that there has been some form of snafu with regard to the testing equipment and that they are probably poking around with stimulation etc since it hasnt been a straight P&A. Not saying that its going to be a success but what theyve foudn could just be very interesting in terms of further understanding of the potential.

Clocking ticking ever closer to SC and Likonde spuds......

 

Fund Management: European Wealth
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djpreston 11th Dec '09 48 of 56
3

Maybe something. Maybe not but Groundstar up 40% today in Canada, gaining throughout the day and closing at a high on volume over 500k or c 8x normal.

Weem?

Or maybe something re their KRG interest?

No news I've seen though.


Fund Management: European Wealth
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DearLeader 11th Dec '09 49 of 56

That's a mighty rise. Nothing on Stockhouse that I can see either.

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oilretire 12th Dec '09 50 of 56

You never know, but I doubt it's KRG related. VST traded flat.

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djpreston 26th Jan '10 51 of 56
7

Asset Swap announced by Groundstar with regard to their interest in Weem:

CALGARY, ALBERTA--(Marketwire - Jan. 26, 2010) - Groundstar Resources (TSX VENTURE:GSA) is pleased to announce that the company has entered into an asset exchange agreement with Karl Thomson Energy Limited (KTE), its partner in its two Egyptian blocks. This exchange is mainly driven by the Company's desire to increase its interest in the West Kom Ombo (WKO) block where Groundstar is operator and has a major working interest, and which is in an area that has been experiencing a high level of activity. Dana Gas Egypt announced on January 11, 2010 the completion of the Al Baraka-4 well, with a potential flow rate with artificial lifting, of 1,300 bopd, on the block adjacent to the east.
According to this agreement, Groundstar is exchanging its 20% working interest in the West Esh El Mallaha (WEEM) block, where KTE has been funding drilling and completion operations solely as of November 27, 2009, for a 20% interest in the WKO block. Groundstar will also receive approximately US$800,000 in adjustments. As a result of this agreement Groundstar's interest in WKO will increase to 80% and its interest in WEEM will be nil. As a result of this asset exchange agreement, Groundstar's net land interest will increase by over 6,000 square kilometres in the WKO block. This agreement is subject to approval of Egyptian Regulatory Authorities.
Aminex Egypt Petroleum Limited (APEL), the operator of the WEEM block, reported the results of the drilling of South Malak-1 that was accordingly announced on January 4, and is currently in the process of conducting multi fracturing and production testing of the South Malak-1 well, and Groundstar extends its best wishes for successful results.

 Edit:

Interesting that WKO where they have a good flow already is being exchanged for Weem and KTE are paying GSA a bit of cash as well.

Fund Management: European Wealth
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oilretire 26th Jan '10 52 of 56

is currently in the process of conducting multi fracturing and production testing

Tempting to read too much between the lines.......

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morality 26th Jan '10 53 of 56
1

Sounds like WEEM must have found some oil if they are swapping 20% for 800k dollars plus a block with flow.

We'll see soon enough anyway.

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StrollingMolby 28th Jan '11 54 of 56
3

I think Groundstar may need to review its website over the weekend:

The Republic of Egypt, approximately 1 million square kilometers in area and with a population of about 80 million, is considered to be one of the most stable countries in Africa.

With regards Aminex (LON:AEX) 's interest in the West Esh El Mellaha block we await developments over the weekend as to how WEEM may be affected.  It appears that a revolution is underway, though Mubarak is not going quietly, or even at all, and has just dismissed his government.

Possibly of little consequence to Aminex whatever comes to pass, but I hope for all concerned that peace is restored before the weekend is over.

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bankerbasher 29th Jan '11 55 of 56
1

In reply to StrollingMolby, post #54

Very little in the AEX valuation if any for Egypt. On the positive side Nymex jumped over $4 Friday on concerns over the Suez canal and tanker access.
Unrest in Egypt could be the start of some major gains in oil futures IMO.
BB

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djpreston 29th Jan '11 56 of 56

Precisely BB

AEX's 10% interest (fully carried to any commercial production) is give zip by the City. Contrast to BP, BG etc....

Fund Management: European Wealth
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