10
Highly committed management team with significant experience in the MENA region through operational excellence
The Group’s executive management team has significant depth and breadth of oil and gas industry experience across the
exploration, appraisal and production sector, and especially in the MENA region. Dr Manssour Ahmed Mohammed Al-
Ali Aboukhamseen (Group Chairman), Sara Hussain Mohammed Akbar (Chief Executive Officer), Mohammad Al
Howqal (Chief Operating Officer) and Mohammad Aboush (Senior Vice-President for Iraq), as well as many of the
Group’s key business managers have spent the majority of their working careers with companies focused on the MENA
region. The four above-named individuals have, in aggregate, over 125 years of work experience in the oil and gas
industry in the MENA region.
Strategy
Kuwait Energy’s aim is to become the leading independent oil and gas exploration and development company in the core
MENA region. The key elements of Kuwait Energy’s strategy for achieving this goal are set out below.
Strengthen asset base in the core MENA region, leveraging existing relationships and track record
The Directors believe that the oil and gas industries in the greater MENA region, which have been dominated by national
oil companies and large integrated oil and gas companies to date, are undergoing a process of liberalisation, with certain
players intending to dispose of regional assets that they view to be non-core, thus creating opportunities for a broader
range of industry participants. In addition, the Directors believe that as oil and gas fields in the greater MENA region
mature, there will be increasing opportunities for independent oil and gas companies that are able to draw on their
technical expertise and operational experience to develop mature fields effectively and cost-efficiently, and turn around
underperforming fields. The Group aims to take advantage of these trends by emphasising its track record of being a
successful operator of a wide variety of oil and gas assets, including both mature producing assets and exploration and
appraisal assets, as well as its in-depth knowledge of the local oil and gas industries in various countries in the core
MENA region. The Group aims to continue presenting itself as a valued partner in the core MENA region for both local
governments and other oil and gas companies in order to enhance the value of the Group’s existing assets and operations,
as well as to secure access to new investment opportunities.
The Directors also believe that there is significant potential for the development of natural gas in the core MENA region
as a result of the unmet and growing need for natural gas in many countries, including Kuwait, Iraq, Bahrain, the United
Arab Emirates and Yemen. Although to date there has been a greater focus on the development of oil rather than gas in
the greater MENA region, the Directors believe that this is in the process of changing as local governments seek to
encourage the production of natural gas in order to meet increasing domestic and regional demand.
As a result, the Group’s strategy is to continue to maintain a balanced portfolio of assets within the core MENA region
that aims at jurisdictional diversity by maintaining a mix of both development assets that generate stable cash flows, and
exploration and appraisal assets that the Directors believe provide future growth potential. As part of its asset selection
process, the Group plans to continue its focus on assets that would benefit from its knowledge of the geological and
subsurface conditions in the core MENA region, as well as its understanding of how to operate effectively in the region
to deliver efficient and cost effective operations.
To further this strategy, the Group has an active exploration and appraisal drilling programme with 91 wells planned for
the period from 1 January 2014 through 31 December 2016, targeting 2P working interest reserves of 400 mmboe and
average daily working interest production of 75,000 boepd (Group estimates). See “
The Group’s Business
—
Planned
capital expenditure and near-term exploration and appraisal programmes
.” This programme includes Block 9 in Iraq,
which is close to existing infrastructure and is estimated to have 700.8 mmboe of recoverable oil resources and 609.5
Bscf (101.6 mmboe) of recoverable gas resources, according to the estimates of the Group’s 2C contingent resources on
a working interest basis as at 31 May 2014 as reported by GCA. The Group commenced drilling the first exploration
well in Block 9 in March 2014. The Group is engaged in active negotiations to farm out a portion of its working interest
share in the Block 9 licence and expects to conclude an arrangement by the end of 2014. If such a farm out arrangement
is entered into, the proportion of the Block 9 contingent resources in the CPR that are attributable to the Group will be
reduced accordingly. Under the terms of the Block 9 licence, the other parties to the licence will have a right of first
refusal to acquire the working interest that is subject to any proposed farm out. See “
Risk factors—Risks relating to the
Group—The Group may be unsuccessful in realising its reserve and production growth targets
” and “
Risk Factors—
Risks relating to the Group—The economic valuations contained in the CPR may not provide an accurate estimate of the
value of the Group or its assets
.” In order to enable it to focus on the core MENA region, the Group is actively seeking
to sell or monetise the assets in or otherwise to exit all jurisdictions save for Egypt, Iraq, Yemen and Oman.
Leverage local knowledge and expertise to enhance operational effectiveness and reduce operational risk
