Australia-listed Petsec Energy has increased its interest in Block 7 in Yemen to 100 per cent after agreeing to buy its partner Kufpec 25 per cent stake.
Block 7 is an onshore exploration permit covering an area of 5,000 sq-km located approximately 340 km east of Sana'a, the capital of Yemen. The block contains the Al Meashar oil discovery as well as an inventory of leads and prospects defined by 2D and 3D seismic surveys with significant oil potential.
The agreement to acquire Kufpec’s interest follows on from deals in recent years which have seen Petsec acquire stakes from previous partners such as Oil Search, AWE and Mitsui. Following the completion of the Kufpec and Oil Search deals, which are still subject to government approvals, Petsec will hold a 100 per cent interest in Block 7.
Petsec Energy's Chairman, Terry Fern, commented on the deal: "We are pleased to have entered into this agreement with KUFPEC which increases our interest in Block 7 to 100 per cent. The Al Meashar oil discovery and the 8 large prospects and leads in Block 7 hold the potential for substantial oil reserves and a consequent substantial increase in the value of Petsec Energy."
Fern added that they look forward to the early start of production from the An Nagyah Oilfield in Block S-1 and subsequent production from the two suspended wells on the Al Meashar oil discovery in Block 7.
Block S-1, acquired in February 2016 from Occidental Petroleum, holds the developed An Nagyah Oilfield, and four undeveloped oil and gas fields which hold substantial oil and gas resources, in excess of 34 million barrels of oil and 550 billion cubic feet of gas.
Crude oil shipments from Yemen restarted in August 2016 for the first time since March 2015 when 4 million barrels of oil were shipped from the Ash Shihr terminal near Mukalla on the Gulf of Aden, and in turn the Masila oilfields have returned to production.