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CEO's Quarterly Message

“In recent months we have significantly increased production bringing three new wells online in the Hawler license area and we continued to mature our AGC Central exploration prospects. 
Gross (100%) oil production from the Hawler licence area averaged 4,400 bbl/d in Q2 2018 and 6,100 bbl/d in July 2018 versus an average of 2,900 bbl/d in Q2 2017 and 3,800 bbl/d in Q1 2018. All oil production has been sold via the export pipeline and payments for export sales through the end of April 2018 have been received in full. Higher realised oil prices and lower operating expenses helped us achieve our highest quarterly netback and operating funds flow on record.
We have been very active with the drill bit in recent months. We spudded and successfully completed the Banan-3 appraisal well targeting the Tertiary reservoir at the Banan West field. The well is on extended test with average daily production of 1,600 bbl/d in July. We also spudded and successfully completed the Zey Gawra-3 well targeting the Cretaceous reservoir at Zey Gawra. A horizontal well design was utilised for the first time in the Hawler license area and this enabled the successful isolation of the oil producing interval from the underlying aquifer and the free gas in the natural gas cap. The Zey Gawra-3 well has produced at an average rate of 1,700 bbl/d over the past 10 days. Most recently, we completed the Banan-2 well, drilled in 2014 but suspended due to security developments in 2014, in the Cretaceous reservoir at the Banan West field. The Banan-2 well has been producing at an average rate of approximately 1,100 bbl/d over the past 5 days but we intend to increase the production rate in the coming days now that all drilling equipment has been demobilised from the well site. 
We have an active drilling program planned for the remainder of 2018. We are planning to drill or workover five additional wells: two wells targeting the Demir Dagh Cretaceous, two targeting the Banan Tertiary and one targeting the Zey Gawra Cretaceous. 
During Q2 2018 we also continued to study the AGC Central license area with additional interpretation and prospect selection ongoing and drilling preparation to follow as we prepare to begin exploration drilling.
We look forward to continuing to implement our plans in 2018 and achieving higher production in the Hawler license area and preparing for an exciting exploration drilling program in the AGC Central license area.”