Offshore Permits: Kerkuoane/Pantelleria
These permits cover an area of over 3,725 Km2 with water depths varying from around 20m to over 1,000m.
Schematic Kerkouane-Pantelleria Permits Location Map
(The map shows 3 discoveries and numerous oil and gas prospects)
Only 3 wells have been drilled in these permits. Each well has discovered gas with encouraging levels of condensate (light oil).
The presence of oil shows and the proximity of produced oil fields immediately to the north east (Nilde - 45 million barrels) and south (Tazerka - 22 million barrels) demonstrate the potential for significant oil discoveries on these permits.
Xstate earned a 10% interest by part funding a 640 km2 3D seismic survey that was acquired in March 2010. After this survey, Xstate contributes to exploration programs in line with its earned 10% interest in the permits.
Option to increase interest in Offshore Permits to 20%
Xstate holds an option to increase its equity in the projects contained within the offshore permits (includes the Dougga discovery, but excludes only the 150km2 Lambouka gas discovery structural closure area) from 10% to 20% prior to the next well to be drilled in the permits.
If Xstate decided to exercise the option, Xstate will refund ADX Energy for 10% of past costs (from 1st January 2010) in the permits, excluding drilling costs of Lambouka-1 and will also fund an additional 15% of the next well to be drilled in the permits outside the Lambouka prospect area (i.e. pay 25% of the next well for 20% equity in the permits as noted above).
Dougga Discovery
Dougga was discovered in 1981 by Shell in approximately 330 metres of water. The well tested gas and condensate from the carbonate reservoirs in the Abiod and Allam Formations. The Abiod Formation produces oil and gas elsewhere onshore and offshore Tunisia. Non hydrocarbon gas content, including indicative CO2 content of approximately 30% in the gas has affected past development cost estimates and project economics at Dougga.
The Operator has recently re-mapped the Dougga structure based on 3D seismic and revised their gas-in-place estimates to a higher level. The Transmed gas pipeline connections to European gas markets have resulted in higher gas price expectations and have consequently changed the economics of gas development in Tunisia. Therefore a revised commerciality study is underway and planning is proceeding on an appraisal well for 2012.
Schematic Cross-Section through Dougga Field
The Operator's Most Likely Recoverable Contingent Resource is 173 million barrels of oil equivalent(mmboe) from the Abiod reservoir only. Underlying Allam reservoir resource potential and expected enhanced fracture pororsity and permeability contribution to resources have not been quantified yet and represent upside potential.
Dougga is close to a collection of interpreted satellite structural closures, including the Dougga West and Elissa Prospects, and prospective channel stratigraphic traps that could add to the total hydrocarbon resource if successfully explored in the future. Discoveries on any of these prospects or nearby leads could be tied back to a Dougga Development and Production hub.
Kerkouane Discovery
In the northern part of the Kerkouane permit the Kerkouane well discovered gas with variable carbon dioxide in 1981 in approximately 110 metres of water.
The discovery well was plugged and abandoned after massive gas kicks. The main reservoir target (Abiod Limestone) was not reached and remains prospective. Oil shows indicates the potential for an oil rim under the discovered gas.
Shell acquired and processed the 104km of 2D seismic data across the discovery for the Kerkouane JV in late 2011.
Schematic Cross-Section through Kerkouane Gas Discovery
Lambouka Discovery
Lambouka is located 12km from Dougga making a production tie-back to a potential development and production hub at Dougga an attractive economic opportunity.
The Lambouka-1 well was drilled in mid 2010 in around 625m of water to a total measured depth of 2,786m at a location in Tunisian waters, before being suspended for future re-entry.
Initial analysis of the Lambouka-1 well indicated an untested gas and associated condensate (light oil) discovery, with at least two hydrocarbon bearing zones. A net gas column of approximately 23 metre is interpreted within these two reservoir units.
These and additional zones of interest in the prospect are to be evaluated further and considered for drilling. No carbon dioxide was detected during the drilling of the well.
The Operator has provided the following assessment of Contingent Resources at Lambouka:
| ADX estimates of Contingent Resources at Lambouka | ||||
| P90 | P50 | Mean | P10 | |
| Sales Gas (BCF) | 145 | 277 | 309 | 528 |
| Condensate (mmbbls) | 11 | 21 | 24 | 41 |
| Oil Equivalent (mmboe)* | 35 | 67 | 75 | 129 |
*Million barrels of oil equivalent
Lambouka Appraisal and Exploration Opportunity
Other Prospects
In the 3700km2 offshore project areas a number of leads and prospects have also been mapped on 2D and 3D seismic data.
The total resource potential is in excess of 1 Billion Barrels of Recoverable Prospective Resources. A tabulation of the Prospective (recoverable) Resources in a selection of the prospects mapped by the Operator on the Permits is shown below:
| Prospects covered by 3D Seismic (Most Likely recoverable Prospective Resources) | |||
| Project Name | Status | Resource Estimate (mmboe) | Likely Fluid |
| Lambouka - Deep | Drill Deeper - Exploration | 126 | Gas condensate |
| Dougga West | Near Field Exploration | 226 | Oil or gas condensate (resource base on Birsa only oil case) |
| Carthage | Exploration | 57 | Gas condensate |
| Total Covered by 2D Seismic | 409 (mmboe) | ||
| Projects covered by 2D Seismic (Most Likely recoverable Prospective Resources) | |||
| Project Name | Status | Recoverable Resource (mmboe) | Fluid |
| Kerkouane | Appraisal | 87 | Gas condensate and oil |
| Lambouka Overthrust | Exploration | 17 | Gas condensate |
| Tazerka – North | Exploration | 24 | oil |
| Galliano | Exploration | 122 | Gas condensate |
| East Galliano | Exploration | 146 | Gas condensate |
| North Zibbibo | Exploration | 20 | oil |
| Cap Bon Mare | Exploration | 77 | Gas condensate |
| Carthage | Exploration | 79 | Gas condensate |
| Total Covered by 2D Seismic | 572 (mmboe) | ||
Xstate holds an option to increase its equity in the projects contained within the offshore permits (includes the Dougga discovery, but excludes only the 150 km2 Lambouka prospect area) from 10% to 20% after reviewing the results of both the 3D seismic and Lambouka-1 well.
If Xstate decided to exercise the option, Xstate will refund ADX Energy for 10% of past costs (from 1 January 2010) in the permits, excluding drilling costs of Lambouka-1 and will also fund an additional 15% of the next well to be drilled in the permits outside the Lambouka prospect area i.e. pay 25% at the next well for 20% equity).
Dougga West Project
The Dougga West Project has been mapped on 3D seismic. It is a thrust structure analagous to the on-trend Nilde Oil Field in Italy which has produced 45 million barrels of oil from Birsa equivalent reservoirs.
The prospect contains prospective reservoirs at up to 4 levels in a vertically stacked position. The oil potential at only the Birsa level (excellent sandstone reservoir quality at nearby Dougga 1 well) is shown in the table below:
| Birsa Oil (recoverable prospective resource) in mmboe | |||
| P90 | P50 | Mean | P10 |
| 32 | 133 | 226 | 557 |
