Dana Gas, BP to Drill Together in El Matariya Concession in Egypt
Dana Gas has signed a participation agreement with BP under which the latter will carry the UAE firm for the drilling of a first exploration well in the El Matariya onshore concession area, Nile Delta in Egypt.
The licence was awarded to BP and Dana in the EGAS 2014 international bid round.
Under the terms of the agreement, BP as operator will carry Dana Gas for its 50 percent share of the cost of the well, subject to an agreed cap of $39 Million (Dana Gas share), Dana Gas said Tuesday.
In consideration for the carry, BP has the option, subject to government approval, to farm into parts of Dana Gas’s West El Manzala (WEM) concession wrea while retaining WEM operatorship and ownership of the existing and future shallow gas business with Dana Gas.
In addition, BP has a further option to farm into other areas of Dana Gas’s WEM concession and into the recently-awarded North El Salhiya concession area, for a 50 percent participating interest in each case, if it elects to drill a second exploration well and carry Dana Gas’s 50% share of the related well costs, again subject to a similar agreed cap.
As with the first farm-in option, operatorship and ownership of the existing and future shallow gas business of the farm-in areas will remain with Dana Gas.
The El Matariya onshore concession area is located onshore Nile Delta and covers an area of 960km2. The drilling of the first exploration well is expected to start in first half of 2016 and will take approximately 8 months to be completed.