Transglobe announces new development lease and operations update

27444603732 aa90b74768 zTransGlobe Energy Corporation has announced the approval of a new development lease and an operations update

Updates:

-South Ghazalat Development Lease approved, targeting an initial ~1000 bopd from the upper Bahariya formation with first oil expected in Q4 of 2019;

-Production averaging 170000 boepd during May (month to date) consistent with April production of 170000 boepd and 7 per cent higher than Q1 average production;

-Drilled and cased the K-63 Development well as an Asl A formation oil well with an internally estimated 74 feet of net oil pay;

-HW-2X discovery well drilled in April continues to clean up and is currently producing 700 bopd.

The company added that corporate production increased during the second quarter due to drilling and well optimisation results in Egypt and new wells in Canada, which was partially offset by reduced ethane production in Canada.

Operations Update

Arab Republic of Egypt

The company received notice that the Development Lease (DL) application for the SGZ-6X discovery well which tested ~3,840 bopd of light oil has been approved by the ministry of petroleum.

The 29.8 sq km DL has a 20-year primary term with a five-year extension available. In addition to the US$1mn DL bonus (as per the concession agreement), the company has committed to drill a minimum of one exploration well on the DL within the first four years of the primary term. Upon receiving approval of the South Ghazalat DL, and having met all the commitments for the first two exploration phases, the company elected not to enter the final 18 month exploration period and relinquished the balance of the South Ghazalat exploration lands.

Eastern Desert (100 per cent WI)

In West Bakr, the K-63 development well was drilled to a total depth of 4,741 feet and cased as an Asl A formation oil well. The K-63 well encountered an internally estimated 74 feet of net oil pay in the main Asl A pool based on well logs and samples. It is expected that K-63 will be completed and placed on production by early June, along with the previously drilled H-30 development well (internally estimated 25 feet of net oil pay). Also in West Bakr, the HW-2X discovery well (internally estimated 113 feet of net oil pay) is producing 700 bopd (field estimate).

The drilling rig is scheduled to move to NW Gharib to drill an exploration well at NWG 38D-1 targeting the Red Bed formation in an adjacent fault block to the east of the producing 38A pool. The company initiated water injection in the NWG 38A Red Bed pool during the quarter to maintain reservoir pressure and increase recoveries.

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