Bond Offering Memorandum 23 July 2014 - page 310

Kuwait Energy
EL-12-211107
47
will rely on the individual suppliers. All other Long Lead Item orders have been placed
with reputable suppliers, and some contracts such as the permanent camp have been
placed.
The current date for delivery of the gas plant modules is 5
th
January, 2015 for the first
train and 30
th
March, 2015 for the second train. The EPC contractor is due to complete
Train 1 by mid-July, 2015.
While KE believes that the planned schedule is achievable, GCA notes that there is a risk
that the first gas production will not be achieved by July, 2015, which is three years after
approval of the PDP, although there is no direct financial penalty for missing this
particular requirement of the GDPSC. The gas plant delivery could easily be delayed (in
customs or in the factory) and may be delivered incomplete in construction or with pieces
missing. The schedule for construction, hydro-test, mechanical completion, pre-
commissioning and commissioning of the plant is reasonable. GCA notes also that the
delays experienced to date mean that the opportunity to reduce subsurface uncertainties
before committing to the construction of the processing facilities has largely disappeared.
3.2
Mansuriya Field
The Mansuriya gas field is located in eastern central Iraq, approximately 50 km northeast
of Baquba in Diyala Province, and 100 km northeast of Baghdad (Figure 3.2). KE holds a
22.5% WI. The Operator is TPAO, holding a 37.5% WI, and other partners are Korea
Gas Corporation (15%) and Midland Oil Company (25%), an Iraqi state company. The
GDPSC has an effective date of 18
th
July, 2011.
The “discovered” reservoirs, which the Contractor Group has the right to develop, include
all reservoirs within the contract area and above the base of the Jaddala/Aaliji Formation,
defined as 1,790 m ss (5,873 ft ss) in the Mansuriya-1 well and its lateral equivalents.
The plateau production rate is fixed at 320 MMscfd of dry gas for a minimum period of
13 years. The minimum work obligation is US$25 MM within the first three years, to
include acquisition, processing and interpretation of 150 km
2
of 3D seismic over the
Contract Area, drilling of two appraisal wells, drilling of a “deep” exploration well to the
Upper Jurassic Formation, and performance of detailed geological and reservoir
engineering studies.
The field was discovered in 1979 by the Mansuriya-1 well (Figure 3.5), which found gas in
the Miocene-aged Jeribe Formation and the Transition Beds, which is the lowest part of
the Fatha Formation (previously known as Lower Fars), at depths of about 3,600 ft ss
(1,100 m ss) and 3,100 ft ss (950 m ss) respectively (surface elevation is about 260 ft
(80 m)).
A second well, Mansuriya-2, was drilled in 1985 on the south-west of the structure, 3 km
to the south of Mansuriya-1. The presence of gas was confirmed in the Jeribe Formation
and in the Transition Beds. A third well, Mansuriya-3, was drilled in 1989 on the north-
west of the structure, about 5.2 km north-west of Mansuriya-1, and tested gas in the
Jeribe Formation. Finally, Mansuriya-4, drilled in 1990 on the flank of the structure, found
gas and oil in the Transition Beds while the Jeribe was water-bearing.
Production tests were conducted on the four wells, achieving gas production rates of
between 15.6 and 76.0 MMscfd. Seven fluid samples from the Jeribe and seven from the
Transition Beds have been analysed. The results are very scattered indicating problems
with the sampling and/or analysis procedures. Measured H
2
S content varied between
1...,300,301,302,303,304,305,306,307,308,309 311,312,313,314,315,316,317,318,319,320,...567
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