Below is a couple of extracts from August 10, 2010 TransAtlantic Announces Second Quarter 2010 Earnings and Operations Update
-------------------------------------------------------------------------------- We are now interpreting our recently completed western extension 3D seismic survey at Edirne. We plan to fill-in the gaps in 3D seismic coverage in the Thrace Basin to facilitate building an inventory of deep and shallow conventional prospects. To that end, we have just completed a 165 square kilometer 3D seismic survey on Amity's license 4037, which sits directly south of our Edirne license, and plan to immediately begin another survey on the southern half of license 4037 to image deeper structures highlighted by old wells. Our seismic crew will then proceed to another Amity license to image highly prospective structures in the central part of the Thrace Basin. Our objective is to add to the successful shallow amplitude plays at Edirne with deeper long-life structural plays.
Turkey Operations Update
On July 3, 2010, we entered into a Purchase Agreement with Zorlu Enerji Elektrik retim A.. ("Zorlu") and Zorlu Holding A.., under which we will acquire 100% of the issued shares of Amity Oil International Pty. Ltd. ("Amity") and Zorlu Petrogas Petrol Gaz ve Petrokimya rnleri naat Sanayi ve Ticaret A.S. ("Petrogas"), each a wholly-owned subsidiary of Zorlu, for a purchase price of $96.5 million. We have received regulatory approval and expect to close the acquisition in August 2010.
Upon closing, we will acquire working interests ranging from 50% to 100% of 18 exploration licenses and one production lease, consisting of approximately 1.3 million gross acres (1.0 million net acres) in the Thrace Basin in northwestern Turkey and 730,000 gross and net acres in central Turkey. Current production from the licenses totals an average of approximately 7.0 million cubic feet of natural gas per day, net to Amity and Petrogas' interest, with an additional estimated 10.0 million cubic feet per day of natural gas production awaiting connection to a pipeline. "The acquisition will build on our presence in the Thrace Basin and provide additional prospective acreage for shallow and deeper conventional gas targets," Malone Mitchell, the Company's Chairman, said. This production would add to the approximately 7.0 million cubic feet of natural gas per day now being produced at our Edirne field.
In addition, upon closing of the Amity and Petrogas acquisition, we will acquire a significant amount of 3D seismic data, much of which is concentrated on two licenses jointly operated by Amity and Turkiye Petrolleri Anonim Ortakligi ("TPAO"), the national oil company of Turkey. We are now interpreting our recently completed western extension 3D seismic survey at Edirne. We plan to fill-in the gaps in 3D seismic coverage in the Thrace Basin to facilitate building an inventory of deep and shallow conventional prospects. To that end, we have just completed a 165 square kilometer 3D seismic survey on Amity's license 4037, which sits directly south of our Edirne license, and plan to immediately begin another survey on the southern half of license 4037 to image deeper structures highlighted by old wells. Our seismic crew will then proceed to another Amity license to image highly prospective structures in the central part of the Thrace Basin. Our objective is to add to the successful shallow amplitude plays at Edirne with deeper long-life structural plays.
Unconventional Potential
"Our inventory of conventional oil and gas targets has been substantially enhanced with our aggressive seismic acquisition programs and the acreage position that will come with the Amity and Petrogas acquisition. But perhaps more important is the potential for unconventional gas, where our fracture stimulation equipment will allow us to pursue opportunities that were previously unrealized due to stimulation requirements," Gary Mize, the Company's President, said.
Most of the equipment necessary to fracture stimulate tight reservoirs is now in Turkey, and the Company expects to begin fracture stimulating wells in the Thrace Basin in September 2010. The first wells to be fracture stimulated will be on license 3791, in which the Company will acquire an interest under its agreement with TPAO. The Company has begun the process of re-entering wellbores to prepare them for stimulation. In addition to re-entry candidates on the TPAO license in the Thrace Basin, the Company has also identified re-entry candidates on Amity and Petrogas licenses. "From the shows and tests of gas in these wellbores, we know there is gas in the reservoir. We expect that the fracture stimulation equipment will enable us to turn those show wells into gas fields," Mr. Mitchell commented. The full report is available on their web site. Despite the doom and gloomers that post on Oel this looks very good to me!
OEL Price at posting:
9.0¢ Sentiment: Hold Disclosure: Held
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