Even for Genel, this would appear a reasonable drill budget commitment, one they probably wouldn't be making if the well's prospects were not significant. That of course goes double for San Leon itself, with a $3mm net paying interest. I reckon that that level of commitment tells us more about the partners' positive thinking than this board is perhaps prepared to recognise. By echovalley
Genel Energy ("Genel") notes today's announcements by its partners San Leon Energy and Serica Energy regarding the Sidi Moussa-1 well offshore Morocco, operated by Genel with a 60% working interest. Genel confirms the information contained in the operational updates issued by its partners. It is premature at this stage of operations and ahead of the forthcoming testing of the well to make any definitive technical interpretation. Genel shall update the market on completion of operations. -ends-
San Leon, the AIM listed company focused on oil and gas exploration in Europe and North Africa, confirms that the SM-1 well in the Sidi Moussa block offshore Morocco has reached a total depth of 2,825mMDBRT (measured depth below rotary table) and encountered oil during drilling operations. Preparations are underway to perform cased hole testing.
San Leon holds a 10% net working interest in the Sidi Moussa block. Total well testing costs are expected to be approximately $22m (net paying interest $3m to San Leon).
Oisin Fanning, San Leon Executive Chairman, commented:
"Testing the SM-1 well aims to evaluate the structure and its hydrocarbon potential as much as possible at this stage of early exploration, and we look forward to updating the market with the results once these are available."
Joel Price, who has reviewed this update, has 20 years' experience in the oil & gas industry and is a member of the Society of Petroleum Engineers. He holds a BA in Natural Sciences from Cambridge University, an MEng from Heriot-Watt University, and an MBA from Durham University. Joel is Chief Operating Officer for San Leon Energy and is based in San Leon's London office.
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