Kurdistan Region of Iraq License Areas
Onshore license area
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Taq Taq Property, a potentially world-class oil field
Iraq is arguably one the most abundant countries in the world in respect of hydrocarbon resources potentially available to the industry. Iraqi proven oil reserves are conservatively estimated to be in excess of 100 billion barrels. Iraqi authorities have set a production target of 6 MMbbl/d by 2013 and it is expected that the country will require significant levels of foreign investment to finance the reconstruction of its oil industry to achieve that goal.
Addax Petroleum, through its participation in the Taq Taq field, is an early entrant in what is potentially a world class oil field.
The Taq Taq field is located in the Kurdistan Region of Iraq, 60 km north-east of the giant Kirkuk oil field, 85 km north-east of Erbil and 120 km north-west of Sulaimaniyah. The license area covers an area of approximately 105,800 acres (428 km2).
In July 2005, Addax Petroleum entered into a farm-in agreement with Genel Enerji A.S. (Genel) for a 30% interest in a Production Sharing Agreement (PSA) for the Taq Taq field. Addax Petroleum subsequently increased its equity position in the Taq Taq field to 45% when it acquired an additional 15% Participating Interest, subject to Kurdistan Regional Government (KRG) back in rights, from Genel Enerji by way of Revised Production Sharing Agreement in November 2006. The Revised Production Sharing Agreement entered into by Addax Petroleum and Genel Enerji with the KRG also expanded the geographic scope of the original PSA to include the Kewa Chirmila prospect. The Production Sharing Agreement was revised again in February 2008 in order to conform to the model Production Sharing Agreement published by the KRG and gave the KRG the right to require that at a future date a government nominanted entity is assigned a 20 per cent interest, which would reduce Addax Petroleum’s interest to 36 per cent.
Addax Petroleum and Genel commenced drilling activities by spudding the first jointly operated well (TT-04) in the Taq Taq license area in mid-2006. The TT-04 well was drilled approximately 600 m south-east of the first Taq Taq well, reached total depth of 2,286 m in September and was flow tested in November 2006. Three reservoir intervals were tested separately and flowed at an aggregate rate of 29,790 bbl/d. In 2007 and early 2008, the TT-05, TT-06, TT-07, TT-08 and TT-09 wells were flow tested at individual well aggregate rates of between 16,170 bbl/d and 37,560 bbl/d.
These findings highlight Taq Taq’s potential to be a major source of reserves and production growth for Addax Petroleum. The success of the appraisal program is a significant step towards the Corporation's goal of producing first commercial oil in the second half of 2008.