Continental Focus, International Reach

Madagascar Oil Updates Ops

Friday, December 20, 2013

Madagascar Oil reported that its cumulative oil production in Madagascar has now exceeded 32,000 barrels total from the cyclic phase of the Steam Flood Pilot (SFP) with 13,776 barrels in Tsimiroro field storage tanks, with the remainder having been used for fuel for steam generation.

Average oil production for November 2013 was 253 bpd. Improvements in oil production rates are still being noted in wells subjected to their third huff-and-puff cycle. Increases in steam injection rates in the designated injection wells have been achieved through increased injection pressures. Two injection wells in the PSF-11 pattern have achieved peak steam injection rates of over 300 barrels of water equivalent per day. Four injection wells have been subjected to continuous steam injection as the SFP moves into the steam-flooding phase.

The company saw steam generation shut down at the end of November for 10 days to allow the safe drilling of two new temperature observation wells. These wells were designed to provide an accelerated steam flood insight in the PSF-11 pattern. Full reservoir section cores were successfully obtained in both wells. The third steam generator passed a pressure test in November to achieve Ministry pressure certification. Work continues to replace the steam generator control software to increase operability and reliability on commissioning of the two offline steam generators. The two commissioned steam generators have achieved an average uptime of 85% during September, October, and November 2013.

The company will conduct core analysis on the recently obtained samples in order to confirm oil saturations pre-steam flooding. A follow up cored well will be considered for drilling when steam has been shown to have passed through the temperature observation wells to arrive at a post flood oil saturation. This is designed to assist in substantiating ultimate oil recovery potential in the Tsimiroro Field under steam flood conditions.

Madagascar Oil said that preparation on the Full Field Development Plan by the Tsimiroro Development Planning Team continues with the prerequisite Declaration of Commerciality on track for a February 2014 submission. Definition of an initial Phase 1 Area centered around the existing SFP wells and facilities is progressing with initial local export markets and routings being defined. Work also continues on marketing studies to allow a firm understanding of the international markets available to Tsimiroro crude.

The company said that the Saybolt Crude Assay results received in October confirmed Tsimiroro as a sweet, heavy low wax content crude with an API gravity of 15° API. Tsimiroro crude oil markets, both local and international, have been identified for refinery, power generation, and marine fuel oil use. Blending trial results to meet fuel standards for potential Madagascar power generation have been conducted by in-country downstream suppliers with additional sampling and trials being planned.

Data consolidation and re-interpretation is now complete across License Blocks 3105, 3106, and 3107. Two field trips in Q3 2013 returned with quality outcrop samples for reservoir and source rock validation and basin modeling study work. A seismic infill program is in the process of being defined to provide better definition on the block leads and prospects.

Madagascar Oil is also looking for a farm out partner in Madagascar and toward that end launched a farm out campaign of the licenses at Africa Oil Week in Cape Town at the end of November 2013 with initial data room entrants being scheduled for late-December and early 2013.


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