Dana Gas commences drilling gas well in Egypt

The Balsam well will be the first horizontal well drilled by Dana Gas Egypt and one of the few drilled in the onshore Nile Delta. Wam

Abu Dhabi: Abu Dhabi-listed Dana Gas has commenced drilling the Balsam-2 development well in the Balsam Development lease onshore Nile delta in Egypt.

“The well will be the first horizontal well drilled by Dana Gas Egypt, and one of very few drilled in the onshore Nile Delta to date,” the energy company said in a regulatory filing to Abu Dhabi Securities Exchange on Sunday.

“The well is expected to take approximately four months to drill and complete. The Balsam-2 well is the first in a major drilling campaign of some 30 wells and a large number of work-overs that will be drilled in the next three years. It forms part of the Gas Production Enhancement Agreement (GPEA) work commitment,” the oil and gas company said in a statement.

In this agreement, Dana Gas has committed to a work programme in return for the ability to sell the government’s share of incremental condensate production at market rates. This mechanism is expected to effectively eliminate the receivables balance by end of 2018, assuming that no further bullet payments are made to the petroleum sector by the Egyptian government.

On Sunday, Dana Gas shares opened at Dh0.43 and after touching a high of Dh0.44 closed at Dh0.43. A total of 149.32 million changed hands.