North Bahariya Concession Transaction-A Novel Strategy for Acquiring the Micro-Scale Producing Fields

Abstract

Since the last decade of the twentieth century, the Egyptian government started enacting new policies aiming at attracting national and international investments through facilitating the regulations and procedures which hinder production and investment resolutions. In this concern, the laws were issued as a step to attract the investment of the Egyptian private sector, international investment and financing corporations. Of the transactions that have recently occurred is the Sale and Purchase of the 50% operatorship interest of North Bahariya Concession.The North Bahariya Concession is an onshore oil concession located in the Western Desert of Egypt, 190 Km SW Cairo City. Currently, the concession covers two development leases namely North Bahariya and Rawda with total approximate area of 117 km 2 containing six producing oil fields; Abrar, Ferdaus, Ganna, Rawda, Rayan, and the most recent field Sidra. The primary productive horizons are the Cretaceous Abu Roash 'G' and Upper Bahariya with secondary production from the Abu Roash 'E'. This paper aims to have an outlook on the evaluation process procedures as well as address the different views on the blocks by many evaluators. The seller had a certain view for the concession potentiality while the buyer has believed in additional potentials based on which the acquisition has been evaluated.Exploration, appraisal, and development activities have been done by the acquirer to prove/disprove the idea of the unseen, by the ex-operator, potentiality. The activities results have had a great effect on the picture of the reserves and resources estimates with new aggressive development plan.The current estimates of OOIP, reserves, upside potential, and field development plans have been completely refurbished according to the new potentiality view as the production and reserve have been increase by 4 times . Trusting the judgment is the key to prove the ideas.