TransGlobe Energy announces Mid-Quarter Egypt Update for Q4 2016

transglobeTransGlobe Energy Corporation announced the mid-quarter Egypt update for the fourth quarter of 2016. All dollar values are expressed in Canadian dollars unless otherwise stated.

Mid-Quarter Operational Highlights, Arab Republic of Egypt:

  • Production Recovery Plan (“PRP”) is on target to achieve 13,000 to 14,000 Bopd by year end 2016.
  • Q4 production expected to meet or exceed guidance of 12,800 Bopd.
  • Production average 12,248 Bopd in October and 13,058 Bopd in November.
  • Development plan for the NWG 3, NWG 16 and NWG 38 area approved December 10th.
  • NWG 3 Early Production Facility (“EPF”) completed mid-December with first production from NWG 3 expected later this week, followed by NWG 38 prior to year-end.
  • Submitted 28 new NWG well locations for military/environmental approvals to explore new prospects, to appraise the oil shows/discoveries at NWG 26, 27 & 38 and to develop the northern portion of NWG in 2017.
  • Drilled 5 wells subsequent to Q3 release (November 7th, 2016) resulting in an oil well (Arta 73) and 4 dry holes (NWG 34, NWG 32, SWG 3, SWG 1).
  • Received military approval to access South Alamein starting September 8th, 2016.
    • Preparing a phase 1 drilling and testing program to assess the Boraq discovery.
    • Targeting an initial 1 well drilling program in the Boraq area and re-entry at Boraq 2.
  • NW Sitra 600 km2 3D seismic acquisition expected to begin in January 2017.

Production Startup at North West Gharib (“NWG”) Arab Republic of Egypt (100% working interest, operated):

The NWG development plan for the NWG 3, NWG 16 and NWG 38 area was approved on December 10th. The Company completed the NWG 3 Early Production Facility (“EPF”) in mid-December and plans first production from NWG 3 this week at an estimated initial rate of 500 to 700 Bpd of 22 API oil. The adjacent NWG 38 discovery well is pipeline connected to the EPF and is expected to commence production prior to year-end. All produced oil will be trucked from the EPF to the Company’s pipeline terminal at West Bakr K Station. The Company’s entitlement oil from NWG will be lifted and sold with the Company’s West Gharib and West Bakr entitlement oil.

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2016 Drilling Program – Arab Republic of Egypt:

Subsequent to the Q3 press release (November 7th, 2016) the Company drilled an additional five wells resulting in one development oil well (Arta 73) and four dry holes (NWG 34 & 32, SWG 3 & 1). Currently one rig is drilling an exploration well at SWG 2 targeting a pre-rift prospect and a second drilling rig is moving on to Arta 74 for the second of two planned Red Bed wells in the Arta field.

Arta 73 was drilled to a total depth of 4,080 feet and encountered 100 feet of gross reservoir with 75 feet net oil pay in the Arta Red Bed pool. The well is scheduled for completion and initial production in early January.

NWG 34 was drilled to a total depth of 3,450 feet targeting Pre-rift Matulla/ Raha/ Nubia clastic structures. The well encountered reservoir sands which were wet. The well was plugged and abandoned.

NWG 32 was drilled to a total depth of 4,650 feet targeting the Kareem, Asl and Lower Rudeis clastic structures. The well encountered reservoir sands which were wet. The well was plugged and abandoned.

SWG 3 was drilled to a total depth of 7,800 feet targeting Pre-rift Matulla/ Raha/ Nubia clastic structures. The well encountered reservoir sands which were wet. The well was plugged and abandoned.

SWG 1 was drilled to a total depth of 4,315 feet targeting a Kareem, Asl and Lower Rudeis clastic structures. The well encountered reservoir sands which were wet. The well was plugged and abandoned.

In addition, the Company has commenced permitting on 28 appraisal and exploration wells in NWG focused on the Red Bed discoveries at NWG 27 and NWG 38, the potential discovery at NWG 26 and additional untested exploration prospects located immediately adjacent to the NWG 3/38 development lease which was approved December 10th, 2016. It is anticipated that a number of these locations will be drilled in early 2017 as part of the 2017 capital budget.

South Alamein, Arab Republic of Egypt (100% working interest, operated):

Military access approvals for the South Alamein concession were received on September 8th, 2016. The Company is finalizing an initial drilling program targeting the Boraq area of the concession. The initial drilling campaign will consist of 1 well on the Boraq structural complex plus re-entering the Boraq 2 discovery well for additional testing. The Company is targeting to commence operations in January 2017 subject to rig approvals. Successful appraisal wells could lead to filing a Boraq development plan as early as Q2-2017 with first production targeted prior to year-end 2017. In parallel the Company will evaluate the remaining exploration prospects on the concession, targeting an exploration drilling program commencing in late 2017 and extending into 2018.

The South Alamein Concession, acquired in July 2012, contains the Boraq 2X discovery (see May 1st, 2012 press release for more details) and several additional exploration targets. The Boraq 2X discovery tested approximately 1,700 Bopd from two zones. The primary Cretaceous zone tested at a rate of 800 to 1,323 Bopd of 34 API oil with no water and a 13% pressure drawdown during a 28 hour drill stem test (DST). A secondary Cretaceous zone tested at a rate of 274 Bopd of 32-35 API oil and 4% water during a 23 hour DST. Test rates are not necessarily indicative of long-term performance but it is anticipated that the well should be capable of producing approximately 1,600 Bopd.

(TransGlobe Energy Corporation Press Release)

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