Prospectus re Admission to the Official List - Heritage Oil

RPS EnergyHeritage Oil – Competent Persons Reportflow against the higher back-pressure. The forecast for the West Bukha production start-up has beenassumed, conservatively, by RPS to be January 2009 although the Operator has advised Heritage thatproduction is targeted for 3 rd Quarter 2008. It has been assumed that Bukha will cease productiontemporarily while West Bukha pressures remain high.West Bukha will reach a point when the flowing pressure will be sufficiently low that the Bukha field wouldbe brought back into production and both fields would produce at the same time through the samepipeline to the Ras Al Khaimah Gas Commission (‘‘RAKGAS’’) plant.3.3. West Bukha FieldThe West Bukha/Henjam gas field is located in the Straits of Hormuz approximately 22 km west of theBukha field in about 90m of water. The field straddles the border between Iran and Oman. The field wasdiscovered in 1975 by the Henjam-1 well in Iran and was subsequently appraised with Khasab-1, drilled byElf in Oman in 1977. Khasab-1 was drilled off structure and encountered water. A second appraisal well,West Bukha 1, drilled in 1987 by IPC found gas condensate but at the time failed to produce commercialrates. The National Iranian Oil Company (NIOC) acquired 3D seismic over the field and approximately80 per cent. of the area covered was made available to the Block 8 licence holders.It is understood that attempts to negotiate a possible joint field development with Iran and Oman failed toproduce an agreement. Although such negotiations are continuing, the Block 8 partnership has sincedecided to pursue an Oman only development. Heritage advises that the Operator has secured agreementfrom the Sultan of Oman’s government to develop the field. However, public domain data from NIOC inIran suggests that an Iranian development is likely to proceed imminently. RPS is not in a position to opineon the legal status of the development.3.3.1. DatabaseThe West Bukha field is covered by 2D seismic acquired from 1974-1986, this data is poor quality. TheIranian National Oil Company acquired a 3D survey over the West Bukha field which covers the Omanand Iranian parts of the field. This survey is high frequency in the upper section but very good quality atthe reservoir depth. The West Bukha 3D has been depth migrated, this data was used prior to the drillingof the West Bukha-2 well where it was found that velocities had been inaccurately modelled. Well Datafrom four wells was made available, West Bukha-1, West Bukha-2, Henjam-1 and Khasab-1. Full log suiteswere made available for these wells as well as geological and test data. A static geological modelwas provided.3.3.2. Geology & GeophysicsThe field consists of a single contiguous NW-SE trending fault and dip closed structure covering an area ofapproximately 62 sq km. Fractured carbonate reservoirs occur within the Cretaceous Ilam, Mishrif,Mauddud and Thamama Formations at depths of between 3,600 and 4,200 m TVDSS. There isconsiderable variation in thickness of the Ilam and Mishrif Formations linked to sedimentary depositionalong a carbonate shelf edge. The Ilam and Mishrif Formations are thickest in Iran where, in Henjam 1,they attained a gross thickness of more than 100 m whilst within the field boundary in Oman theseformations thin to around 50 m. The Mauddud Formation has an average thickness of approximately 80 mthroughout the field and is separated from the underlying Sabsab and Thamama Formations by the NahrUmr shale with an average thickness of 136 m. The Sabsab and Thamama reaches a total thickness ofaround 400 m.The Operator and Heritage have interpreted three horizons across the West Bukha field; Top Ilam, TopNahr Umr and Top Thamama. The first two horizons define the structural envelope of theMishrif-Mauddud reservoir (Figure 9).(4) We note that this consequence has been previously ignored. However, the operator has stated (Sept.07 OCM Minute) that heexpects Bukha production to cease once West Bukha comes on stream.83