The Abu Sennan Concession consists of multiple onshore oil and gas fields in the Western Desert of Egypt. Kuwait Energy Egypt, a subsidiary of Chinese-based United Energy Group, is the operator of the concession.
Kuwait Energy Egypt and GlobalConnect hold a 25% stake each while the other partners in the concession are United Oil & Gas (22%) and Dover Investments (28%).
The commercial production at the concession started in July 2012 with an initial production rate of 2,200 barrels per day (bpd) of oil and 3.5 million cubic feet (mcf) of gas a day.
GlobalConnect completed acquired a 25% stake in the Abu Sennan concession from Kuwait Energy Egypt in October 2017. Rockhopper Exploration had picked up a 22% stake in the Abu Sennan concession from Beach Energy in August 2016, which it sold to the United Oil & Gas in February 2020.
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United Energy Group completed the acquisition of Kuwait Energy in March 2019.
Location and site details
The Abu Sennan concession is located in the Abu Gharadig Basin in the northern part of the Western Desert in Egypt.
The concession consists of seven development leases apart from exploration licenses over a total area of 644km2.
The seven development leases at Abu Sennan are Al Jahraa, Al Jahraa SE, ASZ, Al Ahmadi, ASA, ASH, and El Salmiya.
Oil and gas reserves and the production sharing agreement
The Abu Sennan concession was estimated to hold gross 11.5 million barrels (Mbl) of oil and 10.1 billion cubic feet (bcf) of gas in proven and probable reserves as of December 2019. The concession is also believed to have significant infill and exploration upside potential.
The Abu Sennan concession has a production sharing agreement with Egyptian General Petroleum Corporation (EGPC), a national oil company of Egypt.
Abu Sennan concession development
The Abu Sennan concession comprises 17 producing wells across seven development leases with each well connected to multiple stacked reservoirs. The wells in the area are believed to involve low operating and drilling costs. The operating cost is estimated to be approximately £5.2 ($6.5) a barrel and the drilling cost is estimated to be up to £3.2m ($4m) per well.
A four-well drilling campaign involving drilling of one exploration well in ASH field, two in-fill oil producer wells on Al Jahraa field, and a second water injection well on Al Jahraa field were initiated in 2019.
The developers, however, deferred the drilling of three planned infill wells in 2020 due to a fall in the prices of oil and gas.
The average production at Abu Sennan concession stood at 13,900 barrels of oil equivalent (boepd) in the first half of June 2020. It also included production during the testing of El Salmiya-5 well.
The new production sites in the concession include the ASH-2 well and the new wells in Al Jahraa field. The first gas from the ASH field in 2020 is expected by the end of 2020.
Recently drilled wells in Abu Sennan concession
The drilling of El Salmiya-5 infill well was started in February 2020. Drilled to a depth of 4,400m in the Kharita formations, the well encountered net oil pay in excess of 120m. The results from the well flow testing indicated a production rate of 4,100bpd of crude oil and 18 million cubic feet (mcf) of gas a day.
The drilling of the ASH-2 well was started in October 2019. It was drilled to a depth of 4,030m in the Alem El Buieb (AEB) formation. The net pay encountered by the well was 49.5m. The ASH-2 well flow testing results indicated 7,000bpd of crude oil and 10mcf of gas production a day. The average production from the well has been in upwards of 3,000bpd of oil since January 2020.
The two infill wells Al Jahraa-11 and Al Jahraa-7 started oil production in 2019, while the natural gas production from the Al Jahraa field was started in March 2020.
The Al Jahraa field is connected to the Khalda Petroleum Company (KPC) facility through a 10km-long gas pipeline.