WesternZagros Resources Ltd. (TSX VENTURE:WZR) (“WesternZagros” or “the Company” provides an operational update for its Garmian Block in the Kurdistan Region of Iraq and a corporate update.
The Hasira-1 well is in the process of being suspended after conducting a cased-hole testing program in the high pressure Mio-Oligocene oil reservoir.
During this test the wellbore experienced a considerable influx of reservoir formation debris and this resulted in the termination of the test before a definitive oil flow was possible.
“We feel it is prudent to suspend the well and take the time to re-evaluate the situation before deciding on next steps in this challenging well,” said Simon Hatfield, CEO of WesternZagros.
Sarqala-1 Production Guidance
Light oil production and sales commenced at the Sarqala-1 well on February 11, 2015. WesternZagros has, in accordance with the Kurdistan Regional Government, supplied this production to the domestic market under pre-paid contracts. Sales volumes are currently constrained by domestic market limitations with daily production ranging up to 8,000 barrels of oil per day. Should this situation continue, the Company anticipates that average sales volumes from Sarqala-1 will be in the range of 5,700 to 6,700 barrels per day for the remainder of 2015. Based on these production rates and domestic oil prices in the range of US42 to US$52 per barrel, WesternZagros estimates 2015 production revenues of US$17 to US$25 million and operating income of US$12 to US$20 million, after field operating costs.