Dana Gas reports second gas discovery in Egypt

Dana Gas, the Middle East's largest regional private sector natural gas company, said yesterday it had made its second gas discovery of 2009 in the West Manzala Concession in the Nile Delta region of Egypt.

The discovery, named West Manzala-2 (Haggag prospect), has encountered approximately 20 billion cubic feet (bcf) of dry gas.

The new well, which was spudded on January 18, is located a few hundred metres away from the gas sales pipeline leading from the company's South Manzala gas processing facility.

Dana Gas' Upstream Executive Director Ahmed Al Arbeed said the company would continue its aggressive drilling plan in Egypt in 2009.

"The company has now had four gas discoveries in the last few months and we will continue with this fruitful exploration campaign," he said.

Al Arbeed said the production from this discovery is expected to start during the second quarter.

"This discovery can be brought on stream very rapidly as it is situated near the gas pipeline, which transports gas to the company's South El Manzala gas processing facility. Drilling of additional appraisal and production wells within the Haggag prospect is also being considered."

The West Manzala-2 well, which was drilled to a total depth of 1,510 metres in the Kafr El Sheikh formation of Pliocene age, penetrated a total of 13 metres of net gas pay with two separate good quality sandstone zones of eight and five metres thickness respectively.

The production test, performed in the lower sand only, flowed 11 million standard cubic feet of dry gas through a 32/64'' choke.

Dana Gas ended 2008 with a daily production rate from its Egyptian operations of 31,640 barrels of oil equivalent (boe). This most recent discovery follows the discoveries at El Basant and Salma adding reserves of up to 380bcf of gas plus associated liquids.

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