SacOil completes first phase of Lagia oilfield development
Dual-listed oil and gas company SacOil has completed Phase 1 of the field development operations at the Lagia oilfield in Sinai, Egypt.
The South Africa-based independent company, through its subsidiary Mena International Petroleum Company, also completed hydraulic stimulation on all five existing wells.
Phase 2 operations would start in June, followed by the installation of steam facilities and the drilling of up to five additional wells.
SacOil CEO Thabo Kgogo said in a statement on Wednesday that the completion of Phase 1 marked the company’s transformation from an exploration and production company into realising revenues from the sale of crude oil.
“The next phase of our operations will focus on increasing production, as well as maintaining cost efficiencies and profitability during this [lower] oil price cycle.
“The lower oil price environment is something we are obviously following very closely. For the time being, our net cash position remains positive and we remain committed to our strategic focus of portfolio rationalisation, capital restructuring and overall cost savings,” he added.
The aim of Phase 1 was to stimulate and recomplete the five existing production wells at the Lagia oilfield to increase production. Operations got under way on January 4 and initial production indications were positive.
The company was confident that the targeted average production of 350 bbl/d of oil would be achievable from these five wells once they were in sustained production.
The oil produced from the Lagia oilfield would be trucked to General Petroleum Company’s facilities, owned by Egyptian General Petroleum Corporation, about 300 km away. Payments for delivered crude would be paid directly to Mena.
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