Drucker has received $250,000 and securities of Tanganyika Oil Company Ltd. which consist of 200,000 common shares at a deemed share price of $0.50 Canadian per share and 800,000 special warrants convertible at no cost into 800,000 common shares also at a deemed share price of $0.50 Canadian per share. Before November 1, 2002, Drucker may cancel the special warrants and Tanganyika Oil shall pay $250,000 to Drucker. All necessary regulatory approval has been received.
In exchanging a cash settlement and securities of Tanganyika Oil Company Ltd. for the Company's 20 percent interest in West Gharib, Drucker has become a shareholder of Tanganyika and this should mitigate our exploration risks and future cash calls while retaining exposure to West Gharib, Egypt.
Hana-9, the first well of the current three-well exploration program on the onshore West Gharib Block, was successfully drilled within the Hana field to a total depth of 6,550 feet, ending in the Middle Rudeis sands. The well penetrated the targeted Upper Rudeis sands just below the oil-water contact.
However, the well encountered 45 feet of net oil pay in the upper Kareem reservoir, further extending the Hana field to the west. The well was completed as a Kareem producer and put on production in February 2002 at an initial rate of 800 barrel of oil per day (b/d).
The second well, Hana South-1, was drilled reaching a total depth of 5,500 feet. The Rudeis target in this well was encountered just below the oil-water contact. However, the well encountered a new separate reservoir in the upper Kareem formation.
On testing, using a down-hole jet pump, the well flowed 1,800 b/d and after a cement squeeze operation, the well was re-perforated and flow tested approximately 100 b/d of 13.2 degrees API oil with significant quantities of water using a down-hole hydraulic jet pump. A traditional beam pump will be employed to carry out further well performance evaluations.
The third well, Farag-1, spudded in mid-March 2002 and is testing a new structure located 12 kilometers (7 1/2 miles) northeast of the Hana field. The well is targeting the Miocene Upper Rudeis as well as the deep Nubia reservoir.
There are several offshore giant oilfields with Nubia reservoir in Gulf of Suez Basin (such as July oilfield with 1.3 billion barrels of Original Oil in Place) but they are expensive to drill. The well has reached its target depth of 10,507 feet and logging of potential payzones shall commence.
Besides Drucker’s interest in Tanganyika Oil, the company plans to seek other investment opportunities, according to a company press release. Drucker also may buy back its own stock from time to time at market prices with no specificity. — (menareport.com)
© 2002 Mena Report (www.menareport.com)
