Petsec Energy had been active in the USA since 1989 and had explored offshore in the Gulf of Mexico and onshore in Louisiana, and Texas. Petsec has drilled over 100 wells in the USA and has enjoyed a success rate of 74%.
In 2020, the Company sold all of its U.S. oil and gas assets, sadly bringing an end to a long chapter in the operational history of Petsec in the USA, where the Company has enjoyed much past success and achievements.
The low oil and natural gas price environment coupled with the demand on capital for reinvestment in the U.S. oil and gas assets required that the Company focus all its efforts on the monetisation of its significant assets in Yemen – the Damis (Block S-1) Production Licence and Al Barqa, Block 7 Exploration Permit, in which the Company holds 100% and 75% participating interests, respectively.
In 2014, the Company determined that it wished to pursue both an exploration and an oil reserves acquisitions strategy. Following a strategic review, the Company identified the Middle East & North African (MENA) region as a growth area for the Company where licences with producing oil reserves or near development reserves, with associated high exploration potential, can be acquired at lower prices than those in the USA.
Over the period 2015 to 2018, the Company acquired a 75% interest and operatorship in a large exploration licence (Block 7) area in Yemen, which held a potentially large undeveloped oilfield discovery and a number of drill prospects which held potentially very large oil reserves ranging up to 900 million barrels of oil.
In early 2016, the Company acquired a 100% interest and operatorship in another licence Damis (Block S1) in Yemen, which held five oil and gas fields of which one field, the An Nagyah Oilfield had been developed and was producing until political unrest in 2014 caused it to be shut-in.
The Company has been seeking, since 2017, government approvals to access government owned export transport facilities. In late 2019, the Yemen Oil Minister indicated that those approvals were predicated on the Company securing a financially strong and experienced Yemen oil producer to operate Block S-1.
On 30 September 2020, the Company secured a financially strong and experienced Yemen oil producer to operate Block S-1 as required by the legitimate Yemen Minister for Oil, in order to receive government approvals to access export transport facilities which would permit the restart of oil production from the An Nagyah Oilfield in Block S-1.
The Operator is ready to occupy the site and, when cleared to do so by the Yemen Oil Ministry and the security situation in the South of Yemen has improved, could reopen the camp within a month of approval and have the An Nagyah Oilfield commence production within two months of occupying the camp.