Background to the Block 31 permit
Block 31 permit
On 30 June 2008 the Company announced that it had successfully purchased the Sub Surface Rights on a permit in the Mangistau Basin in South West Kazakhstan. The permit (Block 31) is located in the Zhetybai-Uzen step where government records indicate 6 billion barrels of oil have already been produced. The two biggest oil fields are Uzen and Zhetybai which produce from both the Jurassic and the Triassic.
The permit covers an area of 65 sq km and is located on trend with three existing producing oil fields which have potential reserves of 21-56 million barrels of oil (mmbbls). The Block 31 Contract with the Ministry of OIl & Gas commenced in 2007 and runs for a six (6) year exploration period with the right to extend it twice for two (2) years for a total period of ten (10) years. A follow on Production Licence will then run for a further 25 years.
The Company invested in shooting 3D Seismic over the western (and most prospective) part of the permit in late 2008 and the final results became available in April 2009. A range of targets were identified and/or confirmed as a result of the 3D program. An independent review of the seismic data and recent drilling data from J-50 has confirmed Triassic reserves/resource of ~ 60 mmbbls. The Company believes there is a further ~ 20 mmbbls of prospective resource in the Jurassic, bringing the total reserves/resource estimate for Block 31 to over 80 mmbbls.The Company began its drilling campaign in late 2009 and its first new well (J-50) was a commercial discovery. J-50 went onto production testing in June 2010 and the Company is currently completing its application for a J-50 Trial Production licence. It is hoped this application will be successfully processed during Q4 2010. The 2010 commitment well on the permit (J-51) is planned to be drilled in 2H 2010. Funding has been secured for the drilling of J-51 as well as JPR's 2011 commitment well (J-52).
Concluding Remarks
JPR is firmly committed to oil exploration and production in Kazakhstan and hopes to be exporting oil before the end of 2010.