Monday 27 May 2024
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KUALA LUMPUR (Jan 21): Reach Energy Bhd's subsidiary in Kazakhstan has obtained production contracts for the North Kariman and Yessen fields there, for respective periods of 16 and 25 years, starting Jan 1 this year.

The production contracts were obtained by Emir-Oil LLP, in which Reach Energy controls a 60% stake via Palaeontol BV. Emir-Oil holds the entire 100% working interest in the 850.3 sq km Emir-Oil Concession Block in Kazakhstan.

"This achievement is significant to Emir-Oil's Master Development Plan to integrate the Kariman and North Kariman fields as one large hydrocarbon bearing structure in the near future. Yessen has also shown good productivity in its wells from past well tests, and the company plans to exploit this new commercial field with best-in-class reservoir management practices," Reach Energy said in a filing today.

Meanwhile Reach Energy also announced a three-year extension for Emir-Oil's exploration contract 482 until Dec 31, 2022. The exploration contract's initial termination date was Jan 9 this year.

"This extension consists of eight exploration projects that cover the entire exploration acreage, and Emir-Oil has strategically selected three low-risk exploration well targets as part of Emir-Oil's commitment to this extension," it said.

"In addition, Emir-Oil plans to conduct further seismic reinterpretation that would improve geological understanding of the acreage and further unearth additional prospects for discovery. The company is confident that this extension represents a great opportunity to increase the reserves of the company within the next three years," it added.

On a related matter, Reach Energy said Kazakhstan's Ministry of Energy has signed the Amendments with Work Programmes spanning the 2019-2021 period.

It said Emir-Oil has successfully defended and obtained approval for Analysis of Development (AoD) documents for the Aksaz, Dolinnoe and Kariman fields.

"These AoDs are key Technical Regulatory Documents that underline the respective fields' development plan and production targets over a three-year period. This is a key development as Emir-Oil has included plans to start gas and water injection pilot, specifically at the Kariman field that underlines our commitment to improve production and hydrocarbon recovery from this field," it added.

The announcement came on the heels of a positive result of the testing of Exploration Well K-15 in the concession block, which Reach Energy announced last November.

Emir-Oil drilled its first exploration well in the Kariman field in October 2018. Meanwhile, a local daily reported last August, quoting sources, that Reach Energy intended to acquire the remaining 40% in the Emir-Oil concession from MIE Holdings Corp.

Shares of Reach Energy fell half a sen or 2.86% to close at 17 sen today, giving it a market capitalisation of RM186.39 million. The stock has fallen near 47% in the past 12 months.

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