Location: Nouakchott Sub-basin (Northern MSGBC Basin)
Area: 15,064 km2 (PSC A - 6,969km2 / PSC B – 8,095 km2)
Sterling Equity: Share of State Back-in on Chinguetti Field
Partners: Petronas (Operator), Tullow, SMH, KUFPEC, Premier, ROC
Sterling net revenue interest % PSC A: Sliding scale royalty over 3% PSC B: Sliding scale royalty over 6% (except 5.28% of the Chinguetti Field) Chinguetti Funding Agreement with SMH: Economic interest for approximatley 8% of Chinguetti project
No in-fill drilling or work-over activity took place on the Chinguetti field during the first half of 2009. Gross production
continued to decline over the first six months of 2009, from 16,500 bopd to 9,500 bopd prior to the planned FPSO
annual maintenance shutdown on 26 June. The decline was attributed to increasing water production in most wells. The
field performed better after returning to production on 1 July with a reduced decline rate. In November and December
subsea intervention work was carried out, gas lift was initiated in well C-20, and optimization of the process system was
undertaken. However the overall decline has continued and gross daily production at year end was around 9,200 bopd.
Sterling estimates that at the end of 2009 Chinguetti held a remaining 5.72 mmbbl of gross 2P reserves that could be
accessed with the existing wells. Technical work continues on the reservoir model to investigate the potential for a Phase
3 drilling campaign to access potential resources in 2010/11. However, given the current oil price forecasts, the Phase 3
programme may not be economic and Sterling believes the Chinguetti Field could be abandoned earlier than originally
planned.
During 2009, Sterling’s share of production averaged 906 bopd from its interests in the Chinguetti field through the
funding agreement and royalty interest. Sterling’s current share of Chinguetti production is approximately 715 bopd.
