Dana Gas, the operator of Block 6 off the coast of Egypt, is looking for a financial partner to help fund the exploration of a “primary” prospect in the Block in 2023.

Dana Gas is offering a material interest in Block 6 to any company that can finance the proposed Thuraya well, which is expected to cost $95 million (dry hole). The block where the Thuraya prospect is located is also known as the North El Arish Concession.

After inevitable delays during seismic data acquisition and the COVID pandemic, Dana Gas is also working to secure an extension to the current 2nd Exploration Period. This, combined with the two-year option for a third exploration period, would secure the license area for three years, allowing the well required to be drilled by mid-2023.

Excerpts from a briefing by Envoi, the British acquisition and divestment advisor engaged by the firm to act as the prospect’s marketing agent:

“A $90Million cost recovery pool, which is fully recoverable under Egypt’s profit-sharing fiscal regime, can also be shared with an incoming party. Operatorship is available to suitably qualified companies.”

“Although large carbonate reef prospects are recognised where local basement highs occur in the region (now also including Block 6), the Oligocene sand potential, proven in the Nile Cone by the Salamat and Atoll fields since 2013, has only recently been recognised as a primary play target in the eastern part of Egypt’s offshore nearer to Block 6.”

“Its potential here has been unlocked by the Nour and Ameeq discoveries made in 2019 and 2020 just 20km to the west of Block 6. This Tertiary play fairway is, however, defined by regional seismic amplitude mapping, which clearly show that extensive basin floor fans originated from the Nile Delta. These have prograded through time to the north and east. These delta floor and prodelta complexes progressed into the Levant Basin and through the Block 6 area during Oligo-Miocene times.”

“Today the Miocene is also a proven reservoir in the very large (22Tcf) Leviathan and Tamar Fields to the north east which are interpreted as the younger more distal extension of the same sediment system that passed through Block 6 with similar resource potential, and where it remains undrilled.”

“The majority of the mapped Cretaceous and two distinct Oligocene closures that overlie it in the Thuraya prospect are now confirmed to lie mostly within Block 6 by the new Broadband 3D survey completed in 2020. 3D seismic as well as shipborne gravity and magnetic data was acquired right up to the maritime boundary to define the edge of the Thuraya prospect after the earlier block-wide 2015 3D survey was not permitted to cover the border area.”

“Combined, these two plays in the Thuraya prospect are now estimated to be capable of an un-risked ‘mean’ in-place potential of 17Tcf GIIP (and P10 upside of over 37Tcf GIIP) with a ‘mean’ recoverable resource potential of over 11Tcf (and P10 upside of 24 Tcf recoverable), based on conservative volumetric inputs. The commercial threshold for a development in the area is calculated to be around only 2Tcf recoverable, hence a discovery in either the clastic or reef plays would be highly attractive commercially. The full combined mean resource potential in the Thuraya field of over 11Tcf is calculated to have an NPV10 value of $2,2Billion with an EMV of $1Billion. Block 6 also has material follow-on prospectivity, including the same stacked Oligo-Miocene play in three undrilled prospects which combined could add around 7 Tcf to the Block 6 recoverable resources. The potential value of this opportunity and the Thuraya prospect on its own should not be underestimated. Egypt’s self-sufficiency, with declining domestic gas production, is only expected to be able to fully support demand until around 2025.”

The Thuraya Prospect

Thuraya is close to proven play analogues (including cretaceous reef in Zohr Field to the north and Oligocene clastics in Ameeq and Nour discoveries to the west). It holds estimated combined ‘Mean’ Potential of 17+ Trillion cubic feet (Tcf) of Gas Initially In Place (GIIP) and 37 Tcf Upside (‘Mean’ 11+ Tcf and 24Tcf Upside recoverable resources).