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Petroceltic, Hess to resume oil drilling in Iraq

LONDON, September 17, 2014

Oil and gas explorer Petroceltic said it would resume drilling in Iraqi Kurdistan together with partner Hess in early October, after operations were suspended last month at one of its wells due to security risks in the region.

The partners halted work at the Shireen-1 well in Iraqi Kurdistan on Aug. 9 and evacuated its international staff as a precautionary measure.

Around half of them have now returned to the site to resume drilling work that is expected to take another 90 days to complete, Petroceltic said on Wednesday.

Petroceltic added that it and Hess had not been successful in finding enough gas at the Shakrok-1 well, also in Iraqi Kurdistan, which was abandoned and resulted in a $50.7 million writeoff for Petroceltic in the first half of the year.

This writeoff, together with other unsuccessful exploration expenses in Romania and Egypt, led to a deeper net loss of $57.4 million in the six months through June compared with a loss of $16 million at the same time last year.

However, Petroceltic was able to lift its full-year production guidance to between 21 and 23 million barrels of oil equivalent per day (mboepd), from 20 to 22 mboepd previously expected, after its first-half output exceeded forecasts.

Higher-than-expected production in Egypt at 21 mboepd was the main reason for the upgrade, after the Egyptian government requested an increase in gas sales to the domestic market.

Egypt is experiencing its worst energy crisis in decades as domestic production slumps.

Petroceltic also said it was reviving plans to move to the official lists of the London and Irish stock exchanges by the end of the year, hoping to open itself up to investment from a wider variety of investors and funds.

Shares in the company were trading 0.3 percent lower by 0736 GMT. – Reuters




Tags: oil drilling | Iraqi Kurdistan | Hess |

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