Gulf Keystone Petroleum is the operator of the Shaikan Field, situated about 60 km to the north-west of Erbil covering an area of 280 km². The Company has a Production Sharing Contract with the KRG and has an 80% working interest in the Shaikan licence.
Production facility with current production capacity of 27,500 bopd. Debottlenecking activities remain on track to further increase production capacity to over 30,000 bopd in Q1 2021. Since December 2019, all oil produced is exported via pipeline. Six production wells are currently tied-in to PF-1, with no artificial lift.
- SH-10 & SH-11
Production facility with current nameplate capacity of 20,000 bopd, expected to increase to 27,500 bopd with the recommencement of drilling activities. Since July 2018, all oil produced is exported via pipeline. Five production wells are currently tied-in to PF-2, with one on artificial lift.
Shaikan – a giant field with proven production track record
The Shaikan Field is one of the largest oil discoveries in the Kurdistan Region of Iraq and has been in production since July 2013. To date, the field has produced in excess of 80 million stock tank barrels (“MMstb”) and had estimated 2P reserves of 578 MMstb, as at 31 December 2019. GKP has a vision to grow production to 110,000 bopd over the coming years.
Before the suspension of the activity programme, work was ongoing to increase production to 55,000 bopd with longer-term potential to increase output to 110,000 bopd, by way of a phased investment programme.
- Located c.60km north-west of Erbil in the north-west Zagros fold-belt
- One of the largest fields in Kurdistan by reserves and production
- Cumulative production to date of over 80 MMstb
- Steady production; pressure decline in line with predictions
- Significant growth potential
- Material oil volumes in the Cretaceous, Jurassic and Triassic formations
- Current production from Jurassic only
- Staged approach to de-risk field long-term potential
- Focus on costs – c.$3/bbl Opex mid to long-term
- Scope to optimise as the field is further developed
Key information (gross figures)
- Gulf Keystone interest: 80%
- Partner: MOL 20%
- Discovered: August 2009
- Production start: July 2013
- 1P reserves: 194 MMstb
- 2P reserves: 578 MMstb
- 2C resources: 239 MMstb
- Petroleum cost pool: c.US$500m
Shaikan production growth as at January 2021
The Company made significant progress on facilities debottlenecking and drilling activities in 2020. The Company was on-track to achieve its 55,000 bopd expansion target in Q3 2020, but due to the COVID-19 pandemic the expansion project was suspended in March. Despite recent challenges, production operations have continued safely and reliably throughout the period.
Since September 2020, GKP has grown production, through a number of quick payback projects. SH-12 returned to production on 15 November 2020 with the well flowing at a stable rate of over 5,000 bopd. The production flows to the PF-2 production facility, where there is spare production capacity. The workover design allowed the original Electronic Submersible Pump (“ESP”) completion to remain in place during the operation and the ESP is now back-in service. The operation came in ahead of schedule and on budget. The SH-9 well, on which activity was suspended in March 2020 due to COVID-19, was successfully tied-in to PF-1 and is on production.
In 2020, average gross production at Shaikan was 36,625 bopd, exceeding the top end of the guidance range and the highest annual average production rate to date from the field. Planned debottlenecking works have increased PF-1 production capacity to more than 30,000 bopd and the Company expects to deliver average gross production in 2021 of 40,000 to 44,000 bopd. GKP continues its strong focus on safety which resulted in no Lost Time Incidents during 2020.
Average gross Shaikan production is currently at c.44,000 bopd. GKP is well positioned to restart its drilling programme to achieve 55,000 bopd when circumstances permit.
December 2020 – SH-9 brought on production
November 2020 – Completion of SH-12 workover
July 2020 – Maintenance repairs at PF-1
March 2020 – Suspension of expansion activities
December 2019 – Start of PF-1 export via pipeline & SH-12 well first oil
October 2019 – PF-2 planned shutdown for maintenance and debottlenecking
June 2019 – PF-1 planned shutdown for maintenance and debottlenecking
May 2019 – SH-3 workover completed
February 2019 – SH-1 workover completed & export pipeline shutdown
Reserves and resources summary as at 31 December 2019
|Gross field oil reserves (MMstb)||Gross field oil resources (MMstb)|
Note: The table above is a GKP estimate. GKP updated values from ERC Equipoise – CPR August 2016 and confirmation letter dated April 2017. CPR volume estimates of 615 MMstb as at 31 December 2016, adjusted by GKP for 12.9, 11.5 and 12.0 MMstb gross production in 2017, 2018 and 2019 respectively.
Vision to develop Shaikan
Phased approach provides flexibility to de-risk long-term potential and time capital investment
- No further expansion investment until outlook improves
- Gas management plan revised following result of SH-9 well
- Revised FDP to be submitted in due course for MNR approval
1) Sanction timing of phases from 75,000 bopd & gas re-injection and beyond remain to be confirmed following FDP approval