Dana Gas to explore offshore Sharjah

Dana Gas has agreed to explore and develop its western offshore concession in Sharjah, UAE in the Persian Gulf.

Offshore staff

SHARJAH, UAE -- Dana Gas has agreed to explore and develop its western offshore concession in Sharjah, UAE in the Persian Gulf. The deal marks Dana Gas' entry into the Gulf Corporation Council (GCC) E&P sector, and is also the first offshore upstream asset for the company in the Middle East.

The 25-year agreement was signed by H.H. Dr. Sheikh Sultan bin Mohammed Al Qasimi, UAE Supreme Council member and ruler of Sharjah, and. Hamid Jafar, executive chairman of Dana Gas.

The concession agreement covers a total offshore area of over 1,000 sq km (386 sq mi), and includes the development of the Zora gas field within Sharjah, which was discovered in 1979. The work program will include resuming horizontal drilling of two wells originally drilled by Crescent Petroleum, completion of the drilling work, the installation of offshore platforms for immediate processing and production and the transportation of the processed gas via 25 km (16 mi) of offshore pipeline to be installed by Dana Gas.

The agreement also provides for geological evaluation studies, followed by seismic surveys and the drilling of exploration wells within the concession area.

The preliminary costs of the development phase of the project are estimated at $55 million, while the exploration works are estimated at a further $65 million. The Sharjah 2 well, which was drilled by Crescent Petroleum within the concession area in 2001, was successfully proven with an initial gas production rate of 41 MMcf/d from the Thamama formation.

03/13/2008

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